The stock is down in part because growth stocks are falling as interest rates rise, but investors also haven't been pleased with DraftKings' very aggressive acquisition strategy. An offer to Entain (LSE: ENT) for $22 billion, more than DraftKings' valuation today, has caused the latest consternation for investors.
Is Draft Kings publicly traded?
May 10, 2022 · Draftking's net loss widened in the first quarter to $467 million. Given that stock direction follows earnings over the long term, the lack …
Is DraftKings stock a good investment?
Nov 02, 2021 · As the pandemic's impacts slow, people move to more normal spending patterns and that means less online betting. A pullback in DraftKings' stock as a result seems natural because it was already a...
Is DraftKings profitable?
Oct 06, 2021 · Shares of DraftKings ( DKNG -9.60%) have fallen 35% from their all-time high earlier this year, and are down over 25% in the last few weeks alone. The stock is down in …
Is DraftKings down right now?
Sep 20, 2021 · Shares of online betting company DraftKings ( DKNG -2.30% ) fell as much as 7.3% in trading on Monday as investors quickly exited growth stocks. Shares closed the day down 5.7% after a late-day...
Is DKNG a good stock to buy?
What will DraftKings stock be worth?
| Close | Chg | Chg % |
|---|---|---|
| $12.61 | 1.24 | 10.91% |
What's happening to DraftKings?
Does DraftKings have a future?
Is DraftKings overvalued?
Will DraftKings bounce back?
Who owns the most DraftKings stock?
| Stockholder | Stake | Shares owned |
|---|---|---|
| The Vanguard Group, Inc. | 6.28% | 25,683,022 |
| ARK Investment Management LLC | 5.73% | 23,416,465 |
| T. Rowe Price Associates, Inc. (I... | 4.83% | 19,750,185 |
| Nikko Asset Management Co., Ltd. | 3.46% | 14,142,028 |
How profitable is DraftKings?
Is NIO a good stock to buy?
Will DraftKings stock go down?
That forecast, however, was overshadowed by a wider-than-expected projected loss in 2022 as competition in online sports gambling intensifies. DraftKings shares (ticker: DKNG) were down 14.5%, to $18.86, in morning trading on Friday.Feb 18, 2022
Is DraftKings undervalued?
Does DraftKings own FanDuel?
What happened
Shares of online gambling stock DraftKings ( DKNG -21.62% ) fell as much as 4.7% in trading on Tuesday after getting weak reports from Wall Street. Shares are down 4.5% at 3 p.m. EDT.
So what
Two analyst reports are hurting DraftKings today. The first is from Morgan Stanley analyst Thomas Allen, who restarted coverage on the stock with an equal-weight rating and a price target of $53 per share.
Now what
The world of online sports betting and gambling is certainly growing long-term, but expectations may have gotten ahead of themselves over the last few quarters. As the pandemic's impacts slow, people move to more normal spending patterns and that means less online betting.
NASDAQ: DKNG
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DraftKings is trying to use its stock to acquire the competition, which will be tougher as the stock falls
Shares of DraftKings ( DKNG -0.28% ) have fallen 35% from their all-time high earlier this year, and are down over 25% in the last few weeks alone. The stock is down in part because growth stocks are falling as interest rates rise, but investors also haven't been pleased with DraftKings' very aggressive acquisition strategy.
A growth machine
DraftKings is absolutely a growth machine. The company grew revenue 73% in the past year, and expects to generate $1.21 billion to $1.29 billion in revenue this year.
NASDAQ: DKNG
Revenue growth doesn't come without a price, though. You can see above that the company also burned $425 million in cash over the past year, and that cash burn rate is growing as DraftKings spends on sales and marketing and expansion into new territories.
DraftKings' stock price is important
The falling stock price is important for a couple of reasons. First, stock sales can be used to fund organic growth initiatives, like spending on sales and marketing, as DraftKings has been doing. Given the cash burn rate above, DraftKings could use stock sales to fund further growth as more states open up sports betting and iGaming.
Confidence in DraftKings is key
Investor confidence in a company like DraftKings is key for the company long-term, because it allows management to grow and acquire competitors without having to worry about being profitable or cash-flow positive. The stock can be a piggy bank to be used when needed.
DraftKings is on a slippery slope
Despite being a major player in online gambling in the U.S., DraftKings needs to perform flawlessly and keep investor confidence to reach its potential. After the Entain offer, we're starting to see some cracks in the company's acquisition strategy and the stock is falling as a result.
What happened
Shares of online betting company DraftKings ( DKNG 7.63% ) fell as much as 7.3% in trading on Monday as investors quickly exited growth stocks. Shares closed the day down 5.7% after a late-day recovery.
So what
The biggest reason for the drop at DraftKings was the market's sell-off in general. Fear of the financial markets breaking down are high after issues at China Evergrande Group made global headlines over the weekend.
Now what
I would look at today's drop as a normal part of investing in growth stocks. The company is still doing very well and growing quickly, but that doesn't make it immune from rapid market selling.
