Categories: Invest

Is it too late to buy Skillz stock as shares spike on above-average trading volume?

On Tuesday, Skillz Inc. (NYSE:SKLZ) shares advanced by more than 13% amid increased trading volume. The stock had registered more than 10 million in trading volume by 1:00 pm EST, on course to surpass its daily average of about 14.76 million. The stock ended the session with a volume of 12.96 million, slightly below the daily average.

The multiplayer mobile and online gaming company announced plans to buy Aarki, an intuitive AI platform that enables brands to re-engage mobile users using machine learning, big data, and engaging creativity.


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Skillz CEO Andrew Paradise spoke at the Canaccord Genuity Digital Gaming Summit, ensuring investors of his company’s commitment to completing the $150 million cash and stock acquisition.

Analysts think the purchase could help Skillz monetize its connected user-base by providing marketing insights to brands.

Is Skillz a value trap?

From an investment perspective, Skillz shares trade at a lucrative P/E ratio of 4.68, making the stock an exciting option for bargain hunters. 

However, with analysts expecting its earnings per share to plummet by more than 474% this year before bouncing back by 31.70% next year, Skillz may not be an ideal option for long-term growth investors.

Therefore, the current valuation demonstrates the discount attached to the stock price due to the risks of investing long-term.

Source – TradingView

Technically, Skillz shares seem to have recently spiked to complete an upward breakout from a sharply descending channel formation. As a result, the stock has fully recovered from oversold conditions.

Therefore, investors could target a technical pullback at about $8.69, or lower at $7.63, while $10.61 and $11.67 are crucial resistance zones.

Where to buy right now

To invest simply and easily, users need a low-fee broker with a track record of reliability. The following brokers are highly rated, recognised worldwide, and safe to use:

  1. Etoro, trusted by over 13m users worldwide. Register here >
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