It's easy to invest in the stocks that everyone loves, but the truly life-changing returns can happen when an investor goes against the crowd, picking an unpopular stock, and ends up being right. Gaming platform company Skillz (SKLZ -2.37%) isn't a market favorite; the stock is down more than 70% from its 52-week high set earlier this year. However, three things could really change the story on Skillz for the better.

1. Expanding platform capabilities

Skillz is in the very early stages of developing its platform, and its content is minimal. The games on the platform are largely "casual games," such as solitaire, pool, and bingo. Gamers play a game, and the Skillz platform compares their score against their opponent's to determine the winner of the match. There is no ability to play against someone in real time, eliminating many of the most popular game genres such as battle royal and first-person shooter.

The company recently announced a minority investment of $50 million and a strategic partnership with Exit Games, the developer of Photon, a platform that powers multiplayer games for nearly 600,000 developers worldwide. Game developers can now use Photon to create games on the Skillz platform, fully unlocking the mobile gaming market estimated at $86 billion as of 2020.

Two mobile gaming players competing.

Image Source: Getty Images

Being able to expand in different directions is an underrated factor in how a company performs. Skillz can grow both within and outside of mobile gaming. CEO Andrew Paradise has explicitly outlined the long-term plan to enter new markets including education and fitness. These milestones won't come to pass overnight, but the "blueprint" has been laid by management. Investors will need to monitor developments on real-time games and new markets over the next two or three years to see how Skillz executes.

2. International expansion opportunities

Skillz currently generates less than 10% of its revenue from users outside North America, despite the international gaming market being four times larger than the United States'. Skillz grew its revenue 52% year over year in 2021 Q2, so without this large international opportunity, Skillz has still managed to continue rapidly growing its business.

The company's first international expansion effort will be in India, which Paradise says will launch by the end of 2021. India is the second-most-populous country on Earth, with almost four times the population of the US. Economic growth in India is expected to spur its gaming industry, growing the country's gaming market to 657 million users by 2025. Skillz could be entering this market at the perfect time, and the sheer size of India represents tremendous upside considering the growth that Skillz has achieved with casual games in an isolated domestic market.

Considering the India launch is coming at the end of the year, investors can probably begin to look for a financial impact on revenue toward the end of 2022, as Skillz could take some time to gain and retain users in a brand-new market. After that Skillz plans to expand, gaining offices in parts of Asia and Europe from its acquisition of Aarki.

3. The NFL partnership

Brand partnerships will also aid Skillz's efforts to acquire new users by partnering with key brands that will help market the company. In this regard, the first major domino was announced in February when Skillz and the NFL agreed to partner on a developer challenge that would see games developed and launched on Skillz's platform.

Management noted during 2021 Q2 earnings that the developer challenge is currently down to 14 semifinalists who are now developing their games for judging. Skillz will launch the winning game(s) in time for the 2022 NFL season (Q3 of 2022). The NFL partnership is a huge opportunity for Skillz to demonstrate its value to big brands, and success could inspire future partnerships.

Is Skillz a millionaire maker?

Skillz currently trades at a price-to-sales (P/S) ratio of 11 using management's full-year revenue guidance of $376 million for 2021, and has a meager $4.6 billion market cap. Skillz had a P/S higher than 40 and a $16 billion market cap in February, which shows just how far the stock has fallen.

The company's addressable market will likely expand well beyond $100 billion by the end of the decade from the growth of mobile gaming alone; it has grown at a rate of 23% since 2015. Additionally, new categories such as fitness and education could significantly broaden the horizon for Skillz.

At just a $4.6 billion market cap, Skillz could grow to multiples of its current size over the rest of this decade, depending on how well the company executes on these growth opportunities. There's the risk that things won't work out, but the upside, if things do work, could make patient investors very wealthy.