Dimensional Fund Advisors LP Trims Stock Position in DraftKings Inc. $DKNG

Key Points

• Dimensional Fund Advisors cut its DraftKings stake by 44.7% in the first quarter, selling 503,290 shares and retaining 622,796 shares valued at approximately $13.5 million.
• Institutional ownership remains significant at 37.7%, although DraftKings insiders also sold 97,596 shares worth about $2.76 million over the past three months.
• DraftKings’ outlook is mixed: its Predictions platform is expanding rapidly and analysts maintain a “Moderate Buy” consensus, but second-quarter revenue missed expectations, fell 4.6% year over year, and the company reported a $67.6 million net loss.

Dimensional Fund Advisors LP lessened its holdings in DraftKings Inc. (NASDAQ:DKNG - Free Report) by 44.7% during the 1st quarter, according to its most recent filing with the Securities & Exchange Commission. The firm owned 622,796 shares of the company's stock after selling 503,290 shares during the period. Dimensional Fund Advisors LP owned about 0.13% of DraftKings worth $13,465,000 at the end of the most recent reporting period.

A number of other institutional investors and hedge funds also recently made changes to their positions in the business. Vanguard Group Inc. boosted its stake in shares of DraftKings by 3.1% during the 4th quarter. Vanguard Group Inc. now owns 44,758,204 shares of the company's stock worth $1,542,368,000 after acquiring an additional 1,354,457 shares during the last quarter. Sumitomo Mitsui Trust Group Inc. increased its stake in shares of DraftKings by 11.0% in the 4th quarter. Sumitomo Mitsui Trust Group Inc. now owns 4,370,903 shares of the company's stock worth $150,621,000 after purchasing an additional 433,963 shares in the last quarter. Janus Henderson Group PLC increased its stake in shares of DraftKings by 50.8% in the 4th quarter. Janus Henderson Group PLC now owns 25,313,909 shares of the company's stock worth $858,893,000 after purchasing an additional 8,524,923 shares in the last quarter. Aurora Investment Counsel bought a new position in DraftKings in the 4th quarter worth $2,157,000. Finally, Englebert Financial Advisers LLC bought a new position in DraftKings in the 4th quarter worth $2,203,000. Hedge funds and other institutional investors own 37.70% of the company's stock.

Insider Activity at DraftKings

In related news, insider R Stanton Dodge sold 62,500 shares of DraftKings stock in a transaction that occurred on Thursday, June 11th. The stock was sold at an average price of $29.68, for a total transaction of $1,855,000.00. Following the sale, the insider owned 556,258 shares of the company's stock, valued at approximately $16,509,737.44. This trade represents a 10.10% decrease in their position. The sale was disclosed in a document filed with the Securities & Exchange Commission, which can be accessed through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, Director Woodrow Levin sold 34,234 shares of the business's stock in a transaction that occurred on Monday, May 18th. The stock was sold at an average price of $25.71, for a total value of $880,156.14. Following the completion of the transaction, the director directly owned 29,820 shares in the company, valued at approximately $766,672.20. This represents a 53.45% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. Insiders have sold a total of 97,596 shares of company stock worth $2,756,991 in the last three months. 47.18% of the stock is owned by corporate insiders.

Key DraftKings News

Here are the key news stories impacting DraftKings this week:

• Positive Sentiment: DraftKings’ Predictions platform is expanding rapidly ahead of football season. CEO Jason Robins said annualized volume increased to approximately $11 billion in July from $2.3 billion in April, reinforcing the company’s strategy to become a broader nationwide sports-commerce platform. Prediction markets take center stage in latest round of quarterly earnings reports
• Positive Sentiment: Management said the core business remains positioned to generate roughly $1 billion in adjusted profit this year, providing flexibility to invest in Predictions. DraftKings also reaffirmed its full-year revenue outlook of $6.5 billion to $6.9 billion. DKNG Stock Slips After-Hours As Q2 Earnings Disappoint
• Positive Sentiment: Benchmark raised its DraftKings price target to $30 from $29 and maintained a Buy rating, citing potential upside from the Predictions rollout and the upcoming NFL season. DraftKings price target raised by Benchmark
• Neutral Sentiment: Second-quarter results were mixed: DraftKings reported $1.44 billion in revenue versus approximately $1.51 billion expected, while earnings per share of $0.09 exceeded the consensus estimate cited by some data providers. Full-year guidance was unchanged. DraftKings Reports Second Quarter Results
• Negative Sentiment: Revenue declined 4.6% year over year, and the company swung to a $67.6 million net loss from $157.9 million of profit a year earlier. Heavy promotional activity, along with unfavorable sports outcomes including the Knicks’ title run and World Cup results, pressured quarterly results. DraftKings Second-Quarter Revenue Falls, Hurt by Promotions

DraftKings Trading Up 8.4%

Shares of DKNG stock opened at $24.03 on Friday. DraftKings Inc. has a 52-week low of $20.46 and a 52-week high of $48.78. The company has a debt-to-equity ratio of 3.03, a quick ratio of 1.02 and a current ratio of 1.02. The firm has a market capitalization of $11.92 billion, a PE ratio of -63.24 and a beta of 1.66. The stock has a fifty day simple moving average of $25.37 and a two-hundred day simple moving average of $24.97.

DraftKings (NASDAQ:DKNG - Get Free Report) last announced its quarterly earnings data on Friday, May 8th. The company reported $0.20 EPS for the quarter, missing the consensus estimate of $0.22 by ($0.02). The business had revenue of $1.65 billion during the quarter, compared to analysts' expectations of $1.63 billion. DraftKings had a negative net margin of 2.68% and a negative return on equity of 10.88%. DraftKings's revenue was up 16.8% on a year-over-year basis. During the same quarter in the previous year, the firm earned ($0.07) earnings per share. On average, analysts predict that DraftKings Inc. will post 0.54 EPS for the current fiscal year.

Analyst Ratings Changes

Several analysts have issued reports on DKNG shares. Mizuho boosted their price target on DraftKings from $44.00 to $45.00 and gave the company an "outperform" rating in a report on Tuesday, May 12th. Weiss Ratings downgraded DraftKings from a "sell (d+)" rating to a "sell (d)" rating in a research note on Monday, May 11th. HSBC raised DraftKings from a "hold" rating to a "hold" rating in a research report on Friday, April 24th. Zacks Research upgraded DraftKings from a "strong sell" rating to a "hold" rating in a research note on Wednesday, May 20th. Finally, Freedom Capital raised shares of DraftKings to a "strong-buy" rating in a report on Wednesday, May 20th. One equities research analyst has rated the stock with a Strong Buy rating, twenty-nine have given a Buy rating, eight have issued a Hold rating and two have given a Sell rating to the company. According to MarketBeat, DraftKings has an average rating of "Moderate Buy" and a consensus target price of $34.14.

DraftKings Profile

DraftKings Inc is a leading digital sports entertainment and gaming company specializing in daily fantasy sports, sports betting and iGaming products. The company provides an integrated platform where users can participate in daily fantasy contests, place wagers on professional sports events, and enjoy a range of online casino-style games. DraftKings' proprietary technology supports real-time odds, live scoring and advanced analytics to enhance the user experience across mobile and desktop applications.

Founded in 2012 by co-founders Jason Robins, Matthew Kalish and Paul Liberman, DraftKings began as a daily fantasy sports provider and rapidly expanded into regulated sports betting following legislative changes in the United States.

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