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Is DraftKings Inc. (DKNG) the Best Sin Stock to Invest in 2025?

We recently published a list of 10 Best Sin Stocks to Invest in 2025. In this article, we are going to take a look at where DraftKings Inc. (NASDAQ:DKNG) stands against other best sin stocks to invest in 2025.

Sin Stocks: Is Now the Time to Invest?

Sin stocks are shares of companies involved in activities that are often seen as immoral or unethical. Such companies are involved in a range of sectors such as alcohol, tobacco, gambling, and adult entertainment. Some investors believe that sin stocks profit from human weaknesses and vices. While some ethical investors may be looking to avoid such stocks due to ethical concerns, others may see them as strong investment opportunities.

It is important to note that sin stocks can offer unique benefits. By providing goods and services that people always want, companies involved in such sectors often thrive in tough times and even during recessions. Industries that may be seen as immoral or unethical like gambling, alcohol, and tobacco enjoy consistent consumer demand as people usually continue to purchase their products and services even during economic slowdowns. Some investors argue that this makes sin stocks relatively recession-proof.

READ ALSO: 12 Best Gas Stocks To Buy According to Hedge Funds and 10 Best Organic Food and Farming Stocks To Invest In

In the US, the gambling market is flourishing. Since the Supreme Court struck down a federal law prohibiting sports betting in 2018, gambling and sports betting has grown remarkably. According to the American Gaming Association, sports betting is now legal and operational in 38 states and Washington, D.C. as of January 14, 2025. We could see more markets open up and legalize gambling and sports betting in the near future. Another key trend driving growth in the gambling industry is the surge in popularity of online gambling and iGaming. Online gambling is also attracting young bettors. According to a 2023 survey by the National Collegiate Athletics Association (NCAA), 58% of those aged 18 to 22 had placed at least one wager in 2023.

According to a report by The Business Research Company, the global alcoholic beverages market was estimated to have reached a value of $544.19 billion in 2024. The market is expected to grow at a compound annual growth rate (CAGR) of 5.4% during 2025-2029 to reach a value of $709.13 billion by the end of the forecast period. There is a growing demand for ready-to-drink alcoholic beverages and flavored drinks, especially among younger consumers. The demand for low-alcohol beverages and cocktails made with natural ingredients is also rising as consumers seek healthier options. The 2023 Bacardi Global Consumer Survey found that 44% of respondents in Canada and 43% of younger respondents in the United States plan to consume more cocktails made with natural ingredients in 2024. Additionally, consumers are increasingly willing to pay more for premium and high-quality products. This is another key trend driving growth in the alcoholic beverages industry.

Surveys in the United States have shown that the use of tobacco and marijuana has been fluctuating. Gallup, a global analytics and advisory firm, highlighted in its 2023 update on cigarette smoking that 12% of US adults were smoking cigarettes, slightly up from 11% in 2022. On the other hand, according to combined Gallup data from 2023 and 2024, 15% of US adults reported that they smoked marijuana. Since 2013, the percentage of Americans who report they smoke marijuana has more than doubled. In 2013, when Gallup added the question to its annual Consumption Habits survey for the first time, 7% of US adults reported they smoked marijuana.

Overall, industries like gambling, alcohol, tobacco, and marijuana are experiencing growth, suggesting that now might be a good time to consider investing in sin stocks.

Methodology

To compile our list of the 10 best sin stocks to invest in 2025, we looked for stocks related to gambling, tobacco, alcohol, and other businesses that fall into the category of “unethical” or “sin” stocks. We reviewed our own rankings, financial media reports, and various online resources to compile a list of the best sin stocks. Next, we focused on the top 10 stocks most favored by institutional investors. Data for the hedge fund sentiment surrounding each stock was taken from Insider Monkey’s Q3 2024 database of 900 elite hedge funds. The 10 best sin stocks to invest in 2025 are ranked in ascending order based on the number of hedge funds holding stakes in them as of Q3 2024.

Why do we care about what hedge funds do? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).

A woman at a betting table paying out customers who won their sports bets.

DraftKings Inc. (NASDAQ:DKNG)

Number of Hedge Fund Holders: 54

DraftKings Inc. (NASDAQ:DKNG) is an American gambling and sports betting company. The company offers sportsbook, daily fantasy sports, regulated gaming, and sports betting services. It partners with major sports leagues like the NFL, NHL, NBA, PGA TOUR, UFC, and NASCAR.

The company’s sportsbook is available in 27 US states and in Ontario, Canada, while its daily fantasy sports product is available in 44 US states, certain Canadian provinces, and the United Kingdom. DraftKings Inc. (NASDAQ:DKNG) ranks among the best sin stocks to buy.

The company has strategically expanded into the lottery industry and aims to grow its existing sportsbook and iGaming operations. On May 22, 2024, DraftKings Inc. (NASDAQ:DKNG) closed its acquisition of Jackpocket, the leading digital lottery app in the US. This move allows the company to enter the growing lottery market while also expanding its sportsbook and iGaming by enhancing customer acquisition capabilities.

In the third quarter of 2024, DraftKings Inc. (NASDAQ:DKNG) reported a revenue of $1.095 billion. This marks a 39% increase from $790 million in Q3 2023. The company also reported a significant increase in Monthly Unique Payers (MUPs), which increased 55% year-over-year to reach 3.6 million. This growth was driven by strong customer retention and acquisition across DraftKings Inc.‘s (NASDAQ:DKNG) sportsbook and iGaming products as well as the impact of the Jackpocket acquisition.

The company is actively planning to grow its business. On November 5, 2024, voters in Missouri approved a ballot initiative that legalized sports betting in the state. DraftKings Inc. (NASDAQ:DKNG) aims to launch its sportsbook in Missouri pending market access, licensure, and regulatory approvals. The company also expects to launch its sportsbook in Puerto Rico pending market access and regulatory approvals.

Overall, DKNG ranks 4th on our list of best sin stocks to invest in 2025. While we acknowledge the potential of sin stocks, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than DKNG but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

READ NEXT: 20 Best AI Stocks To Buy Now and Complete List of 59 AI Companies Under $2 Billion in Market Cap

Disclosure: None. This article is originally published at Insider Monkey.

AI, Tariffs, Nuclear Power: One Undervalued Stock Connects ALL the Dots (Before It Explodes!)

Artificial intelligence is the greatest investment opportunity of our lifetime. The time to invest in groundbreaking AI is now, and this stock is a steal!

AI is eating the world—and the machines behind it are ravenous.

Each ChatGPT query, each model update, each robotic breakthrough consumes massive amounts of energy. In fact, AI is already pushing global power grids to the brink.

Wall Street is pouring hundreds of billions into artificial intelligence—training smarter chatbots, automating industries, and building the digital future. But there’s one urgent question few are asking:

Where will all of that energy come from?

AI is the most electricity-hungry technology ever invented. Each data center powering large language models like ChatGPT consumes as much energy as a small city. And it’s about to get worse.

Even Sam Altman, the founder of OpenAI, issued a stark warning:

“The future of AI depends on an energy breakthrough.”

Elon Musk was even more blunt:

“AI will run out of electricity by next year.”

As the world chases faster, smarter machines, a hidden crisis is emerging behind the scenes. Power grids are strained. Electricity prices are rising. Utilities are scrambling to expand capacity.

And that’s where the real opportunity lies…

One little-known company—almost entirely overlooked by most AI investors—could be the ultimate backdoor play. It’s not a chipmaker. It’s not a cloud platform. But it might be the most important AI stock in the US owns critical energy infrastructure assets positioned to feed the coming AI energy spike.

As demand from AI data centers explodes, this company is gearing up to profit from the most valuable commodity in the digital age: electricity.

The “Toll Booth” Operator of the AI Energy Boom

  • It owns critical nuclear energy infrastructure assets, positioning it at the heart of America’s next-generation power strategy.
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Trump has made it clear: Europe and U.S. allies must buy American LNG.

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AI. Energy. Tariffs. Onshoring. This One Company Ties It All Together.

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AI needs energy. Energy needs infrastructure.

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Wall Street is noticing this company also because it is quietly riding all of these tailwinds—without the sky-high valuation.

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This company is completely debt-free.

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The Hedge Fund Secret That’s Starting to Leak Out

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Why? Because excluding cash and investments, this company is trading at less than 7 times earnings.

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  • The AI infrastructure supercycle
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  • A surge in U.S. LNG exports
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You simply won’t find another AI and energy stock this cheap… with this much upside.

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Disruption is the New Name of the Game: Let’s face it, complacency breeds stagnation.

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A New Dawn is Coming to U.S. Stocks

I work for one of the largest independent financial publishers in the world – representing over 1 million people in 148 countries.

We’re independently funding today’s broadcast to address something on the mind of every investor in America right now…

Should I put my money in Artificial Intelligence?

Here to answer that for us… and give away his No. 1 free AI recommendation… is 50-year Wall Street titan, Marc Chaikin.

Marc’s been a trader, stockbroker, and analyst. He was the head of the options department at a major brokerage firm and is a sought-after expert for CNBC, Fox Business, Barron’s, and Yahoo! Finance…

But what Marc’s most known for is his award-winning stock-rating system. Which determines whether a stock could shoot sky-high in the next three to six months… or come crashing down.

That’s why Marc’s work appears in every Bloomberg and Reuters terminal on the planet…

And is still used by hundreds of banks, hedge funds, and brokerages to track the billions of dollars flowing in and out of stocks each day.

He’s used this system to survive nine bear markets… create three new indices for the Nasdaq… and even predict the brutal bear market of 2022, 90 days in advance.

Click to continue reading…