DraftKings, a prominent digital entertainment and gaming company, is seeing revenue growth as more states permit sports betting. Sports betting was permitted in 38 states last year. DraftKings can expand because it only operates in 26 states. The finest part of this story is that the business is growing rapidly in places where it is approved.
The fourth quarter had 37% growth in monthly unique payers, while revenue rose 63% in 2023. The rise in unique payers demonstrates the corporation is still gaining sports-betting customers in established areas. Additionally, DraftKings is expanding outside sports betting. The $750 million acquisition of Jackpot was announced. This opens up a $100 billion lottery market for the corporation.
Despite not making a profit, DraftKings is close to growing free cash flow. Management forecasts $310–$410 million in free cash flow this year. Over time, the stock might deliver large returns if the business becomes free-cash-flow-positive and top-line grows.
Jennifer Saibil (Global-e Online): Global-e builds cross-border e-commerce solutions for retailers. It's growing fast and approaching profitability, and its long-term value makes it a must-have for any e-commerce website.
It's no surprise that Global-e's revenue and GMV are growing significantly. GMV rose 45% and revenue 39% in 2023. It partners with high-profile clients worldwide, including Glossier, EleVen by Venus Williams, the Harry Potter store, Jean-Paul Gaultier, and Zanerobe.
Global-e collaborates with Shopify, which just released Shopify Markets Pro, a white-label repackaging of Global-e's services. Its services are available on Shopify's new one-page checkout, making global shipping easy, and more merchants are signing up. This alliance offers tremendous expansion prospects for the organization.
Global-e's progress toward net profitability at scale makes its potential even more appealing. EBITDA climbed 90% year over year in 2023, and management expects it to grow 40% in 2024. Gross margin rose from 41.1% to 42.9% in 2023, and net loss fell from $195 million to $134 million. Global-e's profitability is limited by Shopify warrants that are amortized on its income statement and will be fully amortized in 2025.
Global-e stock rose 92% in 2023 but is down 14% this year. Ark Invest's Cathie Wood has been purchasing shares on the drop, and smart investors may too.
Costco Wholesale's Jeremy Bowman: Business will alter dramatically in 20 years. Artificial intelligence may replace millions of jobs. Climate change and population shifts might endanger several businesses and generate new winners and losers.
However, I bet that Costco Wholesale will still be a dominant retailer in 20 years and that its loyal customers will continue to flock to it for bargain prices, high-quality products, and the treasure hunt of finding items that won't be there next time.
Costco has a great business model from such technique. It's the third-largest U.S. retailer by revenue and outperforms its rivals. Over the past five years, the company has overcome concerns that it couldn't compete with Amazon or adapt to modern e-commerce.
It keeps opening more stores online and in-person. U.S., Canadian, and Chinese consumers love Costco. The company has regularly raised its dividend and paid a special dividend every few years, making it a stable income choice. Costco's competitive prowess and recession-proof model should help it outperform its industry in good times and bad.
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