DraftKings Inc. $DKNG Shares Bought by Capital World Investors

Key Points

• Capital World Investors increased its DraftKings stake by 181.4% in the fourth quarter, ending with 18.6 million shares valued at about $641.9 million. The move made DraftKings one of the fund’s larger holdings.
• DraftKings reported revenue of $1.65 billion for the quarter, topping expectations, but earnings per share of $0.20 missed estimates by $0.02. Revenue rose 16.8% year over year, and analysts now expect full-year EPS of 0.6.
• Sentiment on the stock remains mixed: analysts still rate DraftKings Moderate Buy overall, though several firms have recently cut price targets or downgraded the shares. Insider selling has also been notable, with directors selling more than 521,000 shares over the past three months.

Capital World Investors boosted its holdings in shares of DraftKings Inc. (NASDAQ:DKNG - Free Report) by 181.4% in the 4th quarter, according to the company in its most recent Form 13F filing with the Securities & Exchange Commission. The fund owned 18,626,429 shares of the company's stock after acquiring an additional 12,008,357 shares during the quarter. Capital World Investors owned about 3.74% of DraftKings worth $641,867,000 at the end of the most recent quarter.

Several other hedge funds and other institutional investors also recently added to or reduced their stakes in DKNG. Viking Global Investors LP acquired a new stake in DraftKings during the third quarter worth $561,125,000. Norges Bank acquired a new stake in shares of DraftKings in the fourth quarter valued at $284,466,000. AQR Capital Management LLC grew its stake in shares of DraftKings by 63.5% in the third quarter. AQR Capital Management LLC now owns 11,685,672 shares of the company's stock valued at $437,044,000 after buying an additional 4,538,007 shares in the last quarter. Capital Research Global Investors grew its stake in shares of DraftKings by 55.9% in the fourth quarter. Capital Research Global Investors now owns 6,615,721 shares of the company's stock valued at $227,978,000 after buying an additional 2,372,520 shares in the last quarter. Finally, Eminence Capital LP grew its stake in shares of DraftKings by 31.9% in the third quarter. Eminence Capital LP now owns 6,274,863 shares of the company's stock valued at $234,680,000 after buying an additional 1,517,413 shares in the last quarter. Institutional investors and hedge funds own 37.70% of the company's stock.

DraftKings Price Performance

Shares of NASDAQ DKNG opened at $24.93 on Monday. The company has a market capitalization of $12.37 billion, a price-to-earnings ratio of 415.50 and a beta of 1.66. The company has a debt-to-equity ratio of 3.03, a current ratio of 1.02 and a quick ratio of 1.02. The business has a 50-day moving average of $23.80 and a two-hundred day moving average of $27.60. DraftKings Inc. has a 1 year low of $20.46 and a 1 year high of $48.78.

DraftKings (NASDAQ:DKNG - Get Free Report) last announced its quarterly earnings results on Friday, May 8th. The company reported $0.20 earnings per share (EPS) for the quarter, missing analysts' consensus estimates of $0.22 by ($0.02). The business had revenue of $1.65 billion for the quarter, compared to analysts' expectations of $1.63 billion. DraftKings had a return on equity of 13.51% and a net margin of 0.93%.The firm's quarterly revenue was up 16.8% on a year-over-year basis. During the same period last year, the firm earned ($0.07) earnings per share. On average, analysts forecast that DraftKings Inc. will post 0.6 earnings per share for the current fiscal year.

Analyst Ratings Changes

A number of brokerages have recently weighed in on DKNG. Susquehanna dropped their price objective on DraftKings from $33.00 to $32.00 and set a "positive" rating for the company in a research note on Tuesday, March 31st. Moffett Nathanson cut DraftKings from a "buy" rating to a "neutral" rating and dropped their price objective for the company from $38.00 to $27.00 in a research note on Friday, April 24th. Morgan Stanley reaffirmed an "overweight" rating on shares of DraftKings in a research note on Thursday, May 21st. Jefferies Financial Group cut DraftKings from a "buy" rating to a "hold" rating in a research note on Friday, April 24th. Finally, Stephens began coverage on DraftKings in a research note on Friday, April 24th. They issued an "overweight" rating for the company. One equities research analyst has rated the stock with a Strong Buy rating, twenty-seven have issued a Buy rating, nine have given a Hold rating and two have assigned a Sell rating to the stock. According to MarketBeat, DraftKings presently has an average rating of "Moderate Buy" and a consensus target price of $34.35.

Insider Activity

In other news, Director Jocelyn Moore sold 2,150 shares of the business's stock in a transaction dated Friday, March 13th. The stock was sold at an average price of $25.60, for a total value of $55,040.00. Following the completion of the sale, the director directly owned 1,406 shares of the company's stock, valued at approximately $35,993.60. The trade was a 60.46% decrease in their position. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through this link. Also, Director Woodrow Levin sold 34,234 shares of the business's stock in a transaction dated Monday, May 18th. The shares were sold at an average price of $25.71, for a total value of $880,156.14. Following the completion of the sale, the director directly owned 29,820 shares of the company's stock, valued at $766,672.20. The trade was a 53.45% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. In the last three months, insiders sold 521,663 shares of company stock valued at $13,144,962. Insiders own 47.18% of the company's stock.

DraftKings Company 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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