DraftKings (NASDAQ:DKNG) Downgraded to "Strong Sell" Rating by Northland Capmk

Key Points

• DraftKings has been downgraded from a "strong-buy" to a "strong sell" rating by Northland Capital Markets, signaling a significant shift in investor sentiment towards the stock.
• Despite the downgrade, other analysts maintain a mixed to positive outlook, with Barclays and Susquehanna issuing target prices of $54.00 and $64.00 respectively.
• The company reported a revenue increase of 36.9% year-over-year in its latest quarterly results, demonstrating growth despite the downgrade in its stock rating.

DraftKings (NASDAQ:DKNG - Get Free Report) was downgraded by investment analysts at Northland Capmk from a "strong-buy" rating to a "strong sell" rating in a research report issued on Wednesday,Zacks.com reports.

Other equities analysts have also issued research reports about the company. Barclays reiterated an "overweight" rating and issued a $54.00 price target (up previously from $51.00) on shares of DraftKings in a research report on Friday, August 8th. Stifel Nicolaus decreased their price target on DraftKings from $53.00 to $51.00 and set a "buy" rating for the company in a research report on Wednesday, July 16th. Northland Securities reiterated an "under perform" rating and issued a $33.00 price target (down previously from $53.00) on shares of DraftKings in a research report on Wednesday. Wall Street Zen upgraded DraftKings from a "hold" rating to a "buy" rating in a research report on Saturday, September 20th. Finally, Susquehanna reiterated a "positive" rating and issued a $64.00 price target on shares of DraftKings in a research report on Friday, August 8th. Twenty-six research analysts have rated the stock with a Buy rating, one has issued a Hold rating and two have given a Sell rating to the stock. According to data from MarketBeat, the company has an average rating of "Moderate Buy" and a consensus price target of $54.50.

DraftKings Trading Down 6.0%

NASDAQ:DKNG opened at $35.16 on Wednesday. The company has a quick ratio of 1.34, a current ratio of 1.34 and a debt-to-equity ratio of 1.82. DraftKings has a 1-year low of $29.64 and a 1-year high of $53.61. The firm has a market capitalization of $17.46 billion, a price-to-earnings ratio of -54.09, a price-to-earnings-growth ratio of 0.89 and a beta of 1.99. The stock has a fifty day simple moving average of $44.62 and a 200 day simple moving average of $39.83.

DraftKings (NASDAQ:DKNG - Get Free Report) last released its quarterly earnings results on Thursday, August 7th. The company reported $0.30 earnings per share for the quarter, beating analysts' consensus estimates of $0.16 by $0.14. DraftKings had a negative return on equity of 30.06% and a negative net margin of 5.63%.The business had revenue of $1.51 billion during the quarter, compared to analyst estimates of $1.39 billion. During the same quarter last year, the company posted $0.12 EPS. DraftKings's revenue for the quarter was up 36.9% on a year-over-year basis. DraftKings has set its FY 2025 guidance at EPS. Sell-side analysts forecast that DraftKings will post 0.64 earnings per share for the current year.

Insider Activity at DraftKings

In other news, insider Matthew Kalish sold 210,000 shares of the firm's stock in a transaction dated Tuesday, August 12th. The stock was sold at an average price of $42.90, for a total transaction of $9,009,000.00. Following the completion of the sale, the insider directly owned 4,190,233 shares of the company's stock, valued at $179,760,995.70. This trade represents a 4.77% decrease in their position. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is available at this hyperlink. Also, Director Jocelyn Moore sold 4,861 shares of the firm's stock in a transaction dated Wednesday, August 13th. The stock was sold at an average price of $43.21, for a total value of $210,043.81. Following the sale, the director directly owned 1,461 shares of the company's stock, valued at $63,129.81. This trade represents a 76.89% decrease in their ownership of the stock. The disclosure for this sale can be found here. Over the last three months, insiders sold 658,331 shares of company stock worth $29,285,365. 51.19% of the stock is currently owned by corporate insiders.

Institutional Inflows and Outflows

A number of institutional investors have recently made changes to their positions in DKNG. FNY Investment Advisers LLC bought a new position in shares of DraftKings in the 1st quarter valued at approximately $26,000. Smallwood Wealth Investment Management LLC bought a new position in shares of DraftKings in the 1st quarter valued at approximately $27,000. GPS Wealth Strategies Group LLC raised its stake in shares of DraftKings by 197.9% in the 1st quarter. GPS Wealth Strategies Group LLC now owns 849 shares of the company's stock valued at $28,000 after acquiring an additional 564 shares in the last quarter. Bank of Jackson Hole Trust bought a new position in shares of DraftKings in the 1st quarter valued at approximately $31,000. Finally, TD Private Client Wealth LLC raised its stake in shares of DraftKings by 54.4% in the 2nd quarter. TD Private Client Wealth LLC now owns 800 shares of the company's stock valued at $34,000 after acquiring an additional 282 shares in the last quarter. 37.70% of the stock is owned by institutional investors.

About DraftKings

DraftKings Inc operates as a digital sports entertainment and gaming company in the United States and internationally. It provides online sports betting and casino, daily fantasy sports, media, and other consumer products, as well as retails sportsbooks. The company also engages in the design and development of sports betting and casino gaming software for online and retail sportsbooks, and iGaming operators.

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