Lottery.com (LTRY) Stock

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Contributor, Benzinga
November 30, 2021
$2.30
-0.02[-0.86%]
Last update: 4:50PM (Delayed 15-Minutes)
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Vol / Avg.0 / 293.476KMkt Cap10.918M
Day Range- - -52 Wk Range1.220 - 13.602

Grinding to a halt after just pulling out of the driveway, weekend warriors are all too familiar with the cascade of obstacles coming their way once the calendar flips to Monday morning. According to traffic analytics firm INRIX, delays on the road worsen every year, resulting in a peak of 99 hours lost in 2019, translating to an average cost of $1,377 per person.

Of course, the otherwise terrible impact of the COVID-19 pandemic brought relief at least to one component of the daily American experience. In 2020, traffic delays dropped by nearly 50% across major cities in the U.S. Still, the concept of transitioning the workforce permanently to remote operations is neither universal nor in many cases feasible. Therefore, the crushing inanity of wasted hours in the car, along with performing busy work in front of a spreadsheet has many Americans dreaming.

Naturally, games of chance come to mind. With a roll of the dice, your life could change, which is the near-universal appeal of Lottery.com. While the market for new public issues have been hit or miss this year, intense interest accompanies Lottery.com’s initial public offering (IPO).

When Did Lottery.com IPO?

Lottery.com was listed on November 1, 2021. Shares are traded on the Nasdaq exchange under the ticker symbol LTRY. However, Lottery.com shares were already available for early bird stakeholders willing to take a blind bet via SPAC.

By now, you’ve undoubtedly read materials about the questionable nature of SPACs. Admittedly, on a year-to-date basis, public market debuts via business combinations with SPACs have underperformed benchmark equity indices. Many of these shell companies post-merger have failed spectacularly, leading investors to question the viability of this financial vehicle.

On the other hand, SPACs are not without their benefits. Among the top include the ability for regular retail investors to wager on enterprises near the ground floor, an opportunity otherwise limited to private equity investors or large institutional players. To be fair, pre-merger announcement SPAC buyers must park their funds without the benefit of knowing what the business is, which is a tradeoff some might not be comfortable with.

In the case of LTRY stock, the underlying firm agreed to combine with Trident Acquisitions Corp. (NASDAQ: TDACU). This blank-check firm filed its intent to go public with the U.S. Securities and Exchange Commission (SEC) in 2018, which confirms that not all SPACs facilitate quick deals. Typically, a shell company has around 2 years to find a deal, and it can use that time and more through special arrangements.

Initially, Trident Acquisitions stated that it was focusing on seeking a “business combination with an oil and gas or other natural resources company in Eastern Europe or interested in expanding into Eastern Europe.” Of course, Lottery.com turned out to be an apples-and-oranges combination based on its original prospectus, confirming that retail investors must be prepared for the unique risks associated with a SPAC-based IPO.

While controversial for its questionable viability, SPACs as an IPO format may be here to stay because it invariably democratizes investment opportunities. Just know ahead of time that all shell companies require an extra dose of due diligence.

Lottery.com Financial History

According to data analytics firm TechNavio, the U.S. lottery market will grow by $20.62 billion during the years 2020 through 2024, representing a compound annual growth rate (CAGR) of nearly 5% during the forecast period. One of the key drivers of this demand is the high penetration of smartphones, which plays directly into the hands of Lottery.com and, by logical deduction, LTRY stock.

Depending on jurisdictional availability, lottery participants no longer have to drive up to a grimy service station in a rough part of town to get their tickets. Instead, by logging onto Lottery.com and downloading its mobile app, players can access Powerball and Mega Millions straight from their portable devices. As well, the process is super convenient, with the app providing you with notifications when jackpots are high.

Most importantly if you win, you no longer need a police escort: the underlying system can transfer your winnings directly to your bank account safely and securely.

To be sure, such gambling platforms have their dark side. As a 2017 op-ed from The Wall Street Journal mentioned, states essentially push lottery tickets on the poor, earning billions of dollars in the process. But because lotteries by nature are low-probability affairs, this system can keep underprivileged communities who lack access to financial education resources in a cynical cycle of poverty.

Further, whenever you discuss the broader financial implications of lottery businesses, you cannot ignore the wealth gap. Specifically, the share of total assets that the bottom 50% in wealth hold remains desperately low at 5.6%. 

Still, business in the interim is good — indeed, it’s excellent. As the “world’s largest provider of lottery data to over 400 digital publishers, including hundreds of digital newspapers, television and news sites and major digital publishers,” Lottery.com commands tremendous influence.

Moreover, in an exclusive interview with Benzinga, Lottery.com CEO Tony DiMatteo emphasized that the firm has the best name and brand in the world. It’s hard to argue the point considering its domain authority. As well, management disclosed that its September quarter revenue will come in between $22 million and $24 million, implying sequential quarter-to-quarter growth of more than 135%.

Lottery.com Potential

There’s no getting around it: SPACs have generated much hype in 2021, but delivering on the enthusiasm has been rather disappointing. However, you must assess each blank-check firm on its own merits. Regarding TDACU stock, its upside trajectory following the merger announcement with Lottery.com has been noteworthy.

According to Casino.org, in the past 2 days since Oct. 22, Trident has been one of the best-performing SPAC equities, trailing only Digital World Acquisition Corp. (NASDAQ: DWAC), the popular but controversial shell company that will bring former President Donald Trump’s social media enterprise public.

Although SPACs have delivered questionable benefits to stakeholders following the completion of their business combinations, some evidence suggests that shell companies taking gambling-related businesses public tend to perform well, most notably DraftKings Inc. (NASDAQ: DKNG).

And like SPACs, LTRY stock brings positive substance to the table. Regarding the former vehicle, blank-check firms provide tradable opportunities that retail investors may not ordinarily have access to. For the latter, lotteries help fund state initiatives such as educational programs and transportation infrastructures.

At the same time, investors cannot be uninformed about the wider social implications of easier access to lotteries. For years, journalists have covered America’s lottery addiction. Therefore, an investment into LTRY stock requires a thoughtful assessment on one’s investing ethos and values.

How to Buy Lottery.com IPO (LTRY) Stock

With Lottery.com poised to trade under its own brand name soon, prospective investors must acquire LTRY stock at the open, a straightforward process if you know how to buy stocks. If not, just follow the steps below.

Step 1: Pick a brokerage.

Brokerages these days offer similar financial incentives, such as commission-free trading. Therefore, you should narrow your list of best brokers to platforms that provide ample access, such as applications for pre-IPO access (or new shares at their initial offering price) for select enterprises.

Step 2: Decide how many shares you want.

No matter the format, IPOs are risky. Avoid putting all your eggs in 1 basket by deploying a balanced share count to mitigate downside moves.

Step 3: Choose your order type.

Before placing your order, understand these market concepts.

  • Bid: The buyer’s best offer for a stock.
  • Ask: The seller’s lowest acceptable price.
  • Spread: The difference between the bid-ask price, the spread indicates market risk as this is also the profit margin for market makers.
  • Limit order: Buy or sell requests at a predetermined price, limit orders provide transparency but no execution guarantees.
  • Market order: Market orders guarantee fulfillment but only at the current rate.
  • Stop-loss order: Stop-loss orders automatically exit your position at either a predetermined price or anything lower.
  • Stop-limit order: Stop-limit orders only leave positions at a specified price, but they also carry non-fulfillment risks.

Step 4: Execute your trade.

Follow these steps to execute a market order:

  1. Select your action type (buy or sell).
  2. Enter the shares you want to acquire (or sell).
  3. Hit the Buy (or Sell) button.

Follow the same sequence for limit orders (but include your execution price).

Scratching Off Profitability at a Cost

Although SPACs have garnered a disappointing reputation this year, blank-check firms taking gambling-related businesses public have fared well, which is encouraging for LTRY stock. As well, lotteries do provide benefits to society. However, investors must balance this advantage with the real social costs of greater access to games of chance.

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About Joshua Enomoto

His distinct writing style of distilling convoluted data into relatable and compelling narratives has earned him recognition among several investment-related publications.