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My Take: 3 Reasons Skillz Investors Should Be Excited About the Acquisition Deal

By Jose Najarro - Jun 4, 2021 at 10:30AM

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This deal could bring a new source of revenue for the gaming company.

In today's video I look at Skillz (SKLZ 2.38%) and share some of my bullish thoughts on the recent announcement that it has acquired Aarki, an ad-tech company. 

Three reasons investors should be excited about the acquisition 

  1. Aarki could bring a new form of revenue for Skillz. At the moment Skillz makes most of its money from paying users. The acquisition of an ad-tech company can pave the way to monetizing nonpaying users.
  2. Aarki has regional sales teams across numerous continents and countries, accelerating Skillz's movement into international markets. 
  3. Skillz's balance sheet should still look healthy after the deal. The acquisition cost is expected to be roughly $150 million in a mixture of stock and cash, and Skillz reported $612 million of cash and short-term investments and no debt from its most recent earnings. 

Click the video below for my full thoughts. 

*Stock Prices used were the mid-day prices of June 3, 2021. The video was published on June 3, 2021. 

 

Jose Najarro owns shares of Skillz Inc. The Motley Fool owns shares of and recommends Skillz Inc. The Motley Fool has a disclosure policy. Jose is an affiliate of The Motley Fool and may be compensated for promoting its services. If you choose to subscribe through his link, he will earn some extra money that supports his channel. His opinions remain his own and are unaffected by The Motley Fool.

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