In today's video I look at Skillz (NYSE:SKLZ) 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. 

 

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.