Key Takeaways
- Benchmark maintained its Buy recommendation on DKNG with a $29 price objective; shares currently hover at $25.15
- The stock has tumbled 45% across the last half-year, touching a 52-week bottom of $21.01
- Week 9 data from New York showed online sports betting revenue climbing 68% year-over-year even as handle decreased 10%
- Director Harry Sloan purchased 100,000 shares worth approximately $2.19M in February; insider ownership stands at 51.19%
- Wall Street consensus shows 25 Buy ratings out of 31 total analysts, with a consensus price objective of $37.19
The sports betting giant has experienced considerable turbulence lately. Shares have declined 45% during the previous six months, closing Friday at $25.15—significantly below the 52-week peak of $48.78.
Despite this downturn, Benchmark analyst Mike Hickey maintained his Buy recommendation alongside a $29 price objective. InvestingPro recently added DKNG to its Most Undervalued securities list.
Wall Street’s broader perspective aligns with this bullish stance. Among 31 analysts tracking the company, 25 assign Buy ratings, four recommend Hold, and only two suggest Sell. The consensus price objective reaches $37.19.
This substantial differential between trading price and analyst expectations is noteworthy.
Fresh data from New York’s sports betting market provided encouraging signals. During Week 9, total handle contracted 10% compared to the previous year, yet revenue exploded 68% higher, powered by a hold rate reaching 9.0%—up 420 basis points from the prior year’s 4.8%.
DraftKings experienced a 27.7% year-over-year decline in handle during this timeframe. However, revenue skyrocketed 442.1% as the hold rate expanded to 8.8%, compared to an exceptionally low 1.2% twelve months earlier. That comparison benefited from an unusually weak prior-year baseline.
Rival PENN posted a 5.1% handle decrease alongside 110.1% revenue growth, with hold advancing to 10.2%. These metrics indicate strong operator performance industrywide.
Ownership Moves and Institutional Interest
Regarding insider transactions, Director Harry Sloan acquired 100,000 DKNG shares on February 17 at an average price of $21.85 per share, investing approximately $2.19 million. This transaction elevated his total stake to 350,219 shares.
CAO Erik Bradbury executed an opposite move, divesting 2,883 shares on March 3 at $24.56, trimming his holdings by 7.02%. Company insiders collectively control 51.19% of outstanding shares.
Dynamic Technology Lab Private Ltd established a fresh position during Q3, acquiring 57,031 shares valued at approximately $2.13 million. Multiple smaller investment firms also increased or initiated stakes throughout this quarter.
Strategic Partnerships and Platform Evolution
DraftKings unveiled an account-linking partnership with ESPN strategically timed for March Madness. This collaboration enables users to leverage a “Bet Your Bracket” functionality that synchronizes with ESPN Tournament Challenge to deliver customized wagering recommendations.
The organization continues advancing its Super App vision, consolidating Sportsbook, Casino, Predictions, and Lottery offerings into a single platform. Analysts from Bernstein, Wells Fargo, and Needham have highlighted the predictions product and integrated application as significant catalysts for expansion.
Wells Fargo reaffirmed its Overweight stance with a $30 price objective. Bernstein elevated its target to $30 while maintaining an Outperform rating. Needham holds a Buy recommendation with a $35 target.
Truist reduced its price objective from $45 to $33 but preserved its Buy rating. Mizuho decreased its target from $46 to $44 while sustaining an Outperform designation.
DKNG’s 50-day moving average currently sits at $28.82, with the 200-day average at $34.00. The company’s market capitalization stands at $12.38 billion. Shares exhibit a beta of 1.67 and carry a debt-to-equity ratio of 2.91.
