DraftKings (NASDAQ:DKNG) Reaches New 1-Year Low Following Analyst Downgrade

DraftKings Inc. (NASDAQ:DKNG)’s share price hit a new 52-week low during mid-day trading on Friday after Citizens Jmp lowered their price target on the stock from $37.00 to $35.00. Citizens Jmp currently has a market outperform rating on the stock. DraftKings traded as low as $20.35 and last traded at $20.9910, with a volume of 2340913 shares changing hands. The stock had previously closed at $21.27.

A number of other equities research analysts have also weighed in on the company. Jefferies Financial Group reissued a “buy” rating on shares of DraftKings in a research note on Wednesday, June 10th. Wall Street Zen lowered DraftKings from a “hold” rating to a “sell” rating in a research note on Saturday, August 15th. Needham & Company LLC reaffirmed a “buy” rating and issued a $35.00 target price on shares of DraftKings in a research note on Friday, September 18th. Wolfe Research initiated coverage on shares of DraftKings in a report on Wednesday, September 2nd. They set an “outperform” rating and a $40.00 price target for the company. Finally, Morgan Stanley dropped their price target on shares of DraftKings from $39.00 to $36.00 and set an “overweight” rating for the company in a research report on Thursday, July 23rd. One investment analyst has rated the stock with a Strong Buy rating, thirty have assigned a Buy rating, eight have assigned a Hold rating and two have issued a Sell rating to the company’s stock. According to MarketBeat, DraftKings has a consensus rating of “Moderate Buy” and an average price target of $34.29.

Insider Activity

In related news, Director Jocelyn Moore sold 10,759 shares of the stock in a transaction dated Wednesday, August 19th. The shares were sold at an average price of $24.05, for a total value of $258,753.95. Following the completion of 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 ownership of the stock. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is available at this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. 47.18% of the stock is owned by corporate insiders.

More DraftKings News

Here are the key news stories impacting DraftKings this week:

• Positive Sentiment: Adjusted sports-volume data from Needham suggests Kalshi’s reported 76% lead in prediction markets may be substantially narrower than headline figures indicate. That could ease concerns about DraftKings losing share in a potentially important growth business. DraftKings Dips as Adjusted Data Narrows Kalshi’s 76% Prediction-Market Lead
• Positive Sentiment: Citizens JMP maintained a “market outperform” rating while lowering its price target from $37 to $35, still implying substantial upside from current levels. The target reduction reflects incremental investment plans rather than a change to the firm’s bullish stance. DraftKings Price Target Lowered to $35 at Citizens
• Neutral Sentiment: Some analysts argue that prediction-market pessimism is excessive, citing strong customer growth, sharply higher market volumes and the potential for higher-margin revenue. However, aggressive customer acquisition and share repurchases could weigh on EBITDA and the balance sheet in the near term. DraftKings Prediction Pessimism Overly Done
• Negative Sentiment: Investors remain concerned that DraftKings’ plans to increase spending on prediction markets will pressure margins before the business produces meaningful profits. Those concerns drove recent selling and overshadowed the company’s longer-term growth opportunity. DraftKings Drops as Prediction-Market Spending Plans Stir Margin Doubts
• Negative Sentiment: Initial data showing Kalshi with a sizable NFL prediction-market advantage triggered fears that DraftKings could be losing an early competitive battle. Although adjusted figures reduce the apparent gap, the issue remains a near-term overhang. DraftKings Falls: Is Kalshi’s NFL Lead Really That Big?

Institutional Inflows and Outflows

Hedge funds and other institutional investors have recently made changes to their positions in the company. Renaissance Technologies LLC bought a new stake in shares of DraftKings during the first quarter valued at approximately $17,660,000. Spruce House Investment Management LLC raised its holdings in DraftKings by 129.6% in the first quarter. Spruce House Investment Management LLC now owns 9,650,000 shares of the company’s stock worth $208,633,000 after purchasing an additional 5,446,166 shares in the last quarter. Janus Henderson Group PLC lifted its position in DraftKings by 9.3% during the first quarter. Janus Henderson Group PLC now owns 27,665,699 shares of the company’s stock valued at $588,288,000 after buying an additional 2,351,790 shares during the period. Aurora Investment Counsel purchased a new position in DraftKings during the fourth quarter valued at $2,157,000. Finally, Capital World Investors boosted its holdings in shares of DraftKings by 181.4% during the 4th quarter. Capital World Investors now owns 18,626,429 shares of the company’s stock valued at $641,867,000 after buying an additional 12,008,357 shares in the last quarter. Hedge funds and other institutional investors own 37.70% of the company’s stock.

DraftKings Trading Down 0.9%

The stock’s fifty day moving average price is $24.01 and its 200 day moving average price is $24.47. The stock has a market cap of $10.47 billion, a P/E ratio of -55.48, a PEG ratio of 1.78 and a beta of 1.63. The company has a current ratio of 1.02, a quick ratio of 1.02 and a debt-to-equity ratio of 3.22.

DraftKings (NASDAQ:DKNG) last issued its quarterly earnings results on Friday, August 7th. The company reported $0.09 earnings per share (EPS) for the quarter, topping the consensus estimate 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 company had revenue of $1.44 billion during the quarter, compared to analyst estimates of $1.51 billion. During the same period last year, the business earned $0.30 EPS. DraftKings’s quarterly revenue was down 4.6% compared to the same quarter last year. Equities research analysts expect that DraftKings Inc. will post 0.49 earnings per share for the current year.

About DraftKings

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.