DraftKings (NASDAQ:DKNG) Stock Price Down 5.1% - Time to Sell?

Key Points

• DraftKings shares fell 5.1% to about $20.08 during mid-day trading, below both the 50-day and 200-day moving averages.
• Despite the decline, analysts maintain a “Moderate Buy” consensus, with an average price target of $34.29—substantially above the current price.
• Recent results were mixed: quarterly EPS beat estimates, but revenue declined 4.6% year over year and remained below forecasts; the company also posted negative net margins and return on equity.

DraftKings Inc. (NASDAQ:DKNG - Get Free Report) shares were down 5.1% during mid-day trading on Tuesday. The stock traded as low as $20.11 and last traded at $20.0750. Approximately 8,846,872 shares traded hands during trading, a decline of 34% from the average session volume of 13,442,821 shares. The stock had previously closed at $21.16.

Analysts Set New Price Targets

Several brokerages have commented on DKNG. Wolfe Research initiated coverage on shares of DraftKings in a research report on Wednesday, September 2nd. They issued an "outperform" rating and a $40.00 price target for the company. Sanford C. Bernstein lifted their price objective on shares of DraftKings from $27.00 to $29.00 and gave the company an "outperform" rating in a research note on Thursday, September 3rd. Jefferies Financial Group restated a "buy" rating on shares of DraftKings in a research note on Wednesday, June 10th. Stifel Nicolaus reduced their target price on shares of DraftKings from $40.00 to $38.00 and set a "buy" rating for the company in a report on Wednesday, July 22nd. Finally, New Street Research set a $29.00 price objective on DraftKings in a research report on Monday, June 1st. One investment analyst has rated the stock with a Strong Buy rating, thirty have assigned a Buy rating, eight have issued a Hold rating and two have issued a Sell rating to the stock. According to data from MarketBeat.com, the company presently has a consensus rating of "Moderate Buy" and an average target price of $34.29.

DraftKings Price Performance

The company has a current ratio of 1.02, a quick ratio of 1.02 and a debt-to-equity ratio of 3.22. The stock has a 50-day simple moving average of $23.89 and a 200 day simple moving average of $24.42. The stock has a market capitalization of $9.94 billion, a price-to-earnings ratio of -52.83, a price-to-earnings-growth ratio of 1.80 and a beta of 1.63.

DraftKings (NASDAQ:DKNG - Get Free Report) last posted its quarterly earnings results on Friday, August 7th. The company reported $0.09 earnings per share (EPS) for the quarter, topping analysts' consensus estimates of $0.02 by $0.07. DraftKings had a negative net margin of 2.68% and a negative return on equity of 11.26%. The business had revenue of $1.44 billion during the quarter, compared to analyst estimates of $1.51 billion. During the same period in the prior year, the firm earned $0.30 earnings per share. The firm's revenue was down 4.6% compared to the same quarter last year. On average, equities research analysts forecast that DraftKings Inc. will post 0.49 EPS for the current fiscal year.

Insider Buying and Selling

In other DraftKings news, Director Jocelyn Moore sold 10,759 shares of the company's stock in a transaction dated Wednesday, August 19th. The stock was sold at an average price of $24.05, for a total value of $258,753.95. Following the transaction, the director directly owned 1,881 shares of the company's stock, valued at $45,238.05. This represents a 85.12% decrease in their position. The sale was disclosed in a document filed with the SEC, which is available at this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. 47.18% of the stock is owned by company insiders.

Institutional Trading of DraftKings

Institutional investors have recently added to or reduced their stakes in the business. QRG Capital Management Inc. increased its stake in shares of DraftKings by 30.6% during the 2nd quarter. QRG Capital Management Inc. now owns 65,476 shares of the company's stock worth $1,654,000 after purchasing an additional 15,358 shares during the last quarter. Envestnet Portfolio Solutions Inc. increased its position in DraftKings by 9.0% during the second quarter. Envestnet Portfolio Solutions Inc. now owns 13,744 shares of the company's stock worth $347,000 after buying an additional 1,139 shares during the last quarter. RFG Advisory LLC raised its holdings in DraftKings by 14.2% during the second quarter. RFG Advisory LLC now owns 47,834 shares of the company's stock valued at $1,208,000 after buying an additional 5,930 shares in the last quarter. NewEdge Advisors LLC lifted its position in shares of DraftKings by 50.4% in the second quarter. NewEdge Advisors LLC now owns 45,486 shares of the company's stock worth $1,149,000 after buying an additional 15,238 shares during the last quarter. Finally, IFP Advisors Inc increased its holdings in shares of DraftKings by 26.8% during the 2nd quarter. IFP Advisors Inc now owns 13,027 shares of the company's stock valued at $329,000 after acquiring an additional 2,750 shares during the last quarter. 37.70% of the stock is currently owned by institutional investors and hedge funds.

DraftKings Company Profile

DraftKings Inc is a digital sports entertainment and gaming company that operates online sports betting, iGaming and daily fantasy sports platforms. Its products enable customers to place bets on professional and collegiate sports, play online casino games where permitted, and participate in fantasy contests across a range of sports.

The company also offers related services, including retail sportsbooks in select jurisdictions and sports media content through DraftKings Network. Its offerings are available in U.S.

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