We recently published a list of 21 Stocks on Jim Cramer’s Radar. In this article, we are going to take a look at where DraftKings Inc. (NASDAQ:DKNG) stands against other stocks on Jim Cramer’s radar.
On Friday, Mad Money host Jim Cramer discussed this week’s main market drivers and placed emphasis on earnings reports and recent economic data.
“When you get a strong employment report like we did this morning, it does a lot of things that you need to know about. First, it takes a near-term recession kind of off the table. Very difficult to have recession with a 4.2% unemployment rate. That’s just too much demand for workers.”
READ ALSO: Jim Cramer’s Thoughts on These 13 Stocks and 8 Stocks on Jim Cramer’s Radar Recently.
Beyond that, Cramer pointed out that strong employment data also influences the Federal Reserve’s thinking, especially ahead of this week’s policy meeting. He explained that a tight labor market discourages the Fed from lowering interest rates.
Lastly, he noted that this kind of labor report can trigger a strong rally in stocks, provided that wage inflation remains under control. Cramer emphasized that while the government releases a constant stream of economic figures, none carry the same weight as the jobs report. He noted, “That is the real predictive power when it comes to the stock market.”
“So keep in mind that today’s rally may not be one off as we go through our game plan for next week. But first, let me just say we’re over the hump. We’ve now had companies that reported fabulous numbers.”
Furthermore, another driver behind Friday’s market surge, according to Cramer, was news out of China suggesting a possible diplomatic overture. He said the rally accelerated after reports surfaced that Chinese officials were considering a deal involving tougher action against fentanyl. If the proposed agreement materializes, Cramer believes it could extend the rally further. He said, “If that comes true, I expect this rally will have legs.”
“Here’s the bottom line: We know that we’re living through a time of great tumult. We could easily be thrown off if President Trump responds harshly to this Chinese olive branch this very weekend. If that happens, there could be some unwinding to do. Right now, though, it looks like the momentum can keep up as long as we don’t get a total breakdown in the nascent trade talks between the world’s two biggest nations.”
Our Methodology
For this article, we compiled a list of 21 stocks that were discussed by Jim Cramer during the episodes of Mad Money aired on May 2. We listed the stocks in the order that Cramer mentioned them. We also provided hedge fund sentiment for each stock as of the fourth quarter of 2024, which was taken from Insider Monkey’s database of over 1,000 hedge funds.
Why are we interested in the stocks that hedge funds pile into? 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 373.4% since May 2014, beating its benchmark by 218 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: 65
DraftKings Inc. (NASDAQ:DKNG) was the last company in Cramer’s game plan for this week, and he remarked:
“Will DraftKings make a comeback here? We like this company very much, but the stock does seem stalled, doesn’t it? Maybe it needs more states to legalize sports betting.”
DraftKings (NASDAQ:DKNG) is a major digital sports entertainment and gaming company that provides online sports betting, casino games, daily fantasy sports, and retail sportsbooks. The company also offers sports betting and casino gaming software for both online and retail sportsbooks, as well as iGaming operators. Nightview Capital stated the following regarding the company in its Q4 2024 investor letter:
“DraftKings Inc. (NASDAQ:DKNG) has been a solid performer, benefiting from the growth of online sports betting (OSB) in the U.S. However, we recently decided to exit our position due to concerns about its long-term competitive positioning and an evolving risk/reward profile. While the company has shown impressive user growth and reached profitability, its reliance on high customer acquisition costs and a crowded competitive landscape raises questions about sustainability. The industry’s low barriers to entry mean DraftKings must continually invest to maintain its edge, which could compress future margins. Additionally, we see a ceiling on market expansion as OSB approaches saturation in key states.
Our decision was also influenced by the rising potential of alternative opportunities in more differentiated industries with structural advantages, which align better with our investment philosophy of long-term compounding.”
Overall, DKNG ranks 21st on our list of stocks on Jim Cramer’s radar. While we acknowledge the potential of DKNG as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. 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 this cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires.
Disclosure: None. This article is originally published at Insider Monkey.
