If You Invested $1,000 In DraftKings Before Sports Betting Was Legalized, Here's How Much You'd Have Now
When online sports betting became available to the masses, the state of New Jersey was the first to jump on the trend. After the ban of sports betting was lifted, New Jersey Governor Phil Murphy pounced on what he saw as a golden opportunity. Within weeks of the decision, on June 11, 2018, Governor Phil Murphy signed legislation permitting sports betting at New Jersey's casinos and racetracks–and from there, sports betting was born.
When sports betting first launched, you didn’t have many options. Really the big two main sportsbooks were FanDuel and DraftKings, which are still two of the most prominent sportsbooks on the market today.
Before sports betting was legal, the best way to legally risk your cash for more in return was the stock market. So, the question kind of asks itself: how much money would you make if you invested in DraftKings before the sports betting boom took off?
Let’s take a look.
DraftKings Goes Public
DraftKings first hit the stock market in 2019, a bit over a year after sports betting became legalized in New Jersey. DraftKings launched as a corporation in 2012, and was solely a Daily Fantasy Sports operator. Things changed in 2018 though when the US Supreme Court struck down the Professional Amateur Sports Protection Act, which prevented states from allowing sports betting (aside from a few exceptions).
When this happened, DraftKings shifted its focus to sports betting–and they never looked back. DraftKings managed to go public on the NASDAQ through a blank-check company, Diamond Eagle Acquisition Corp, in 2019. Its opening price was $9.80 a share (on 7/25/2019).
What Would Happen if You Invested $1000 in DraftKings in 2019?
When DraftKings first went public in 2019, it cost $9.80 a share. So, if you invested $1000, you would end up with 102.04 shares. At its peak, the DraftKings stock sold for $71.98 a share, and that was in March of 2021. By September 2021, the price of DraftKings went down to $63.67, and it has been in a downwards slump since.
At the time of this story, the closing bell price for DraftKings was just $13.69. Sure, it’s a far cry from that $71.98 price we saw in March, but at the end of the day it’s still a good ROI on our initial $1000. If you bought $1000 worth of DraftKings when it launched and sold it today, you would end up with $1,396.93, which is a $396.93 gain.
If you sold when DraftKings was at its peak though, you’d have a nice net gain of $6,344.