Here's Why I'd Avoid DraftKings Stock Like the Plague
Investors have certainly been excited about the prospects for sports betting company DraftKings (NASDAQ: DKNG). Since it officially began trading in its present form on April 24, the stock is up nearly 100%, compared to a roughly 6% increase for the S&P 500.
The company began life as a provider of daily fantasy sports contests, but has morphed into something much more. To say the company took an unusual path to public trading would be an understatement. DraftKings merged with SBTech and Diamond Eagle Acquisition -- a special purpose acquisition company (SPAC) -- an entity whose sole purpose is to raise capital in an IPO and then acquire an existing company.
But its circuitous route to trading isn't why I would avoid the company at all costs. It's an important disclosure DraftKings made to regulators in the run-up to its public debut -- and it's a doozy.
Source Fool.com
