Insiders at sports betting firm DraftKings (DKNG) have used the post-earnings drop in the company’s stock to buy shares.
TipRanks Black Friday Sale
- Claim 60% off TipRanks Premium for the data-backed insights and research tools you need to invest with confidence.
- Subscribe to TipRanks' Smart Investor Picks and see our data in action through our high-performing model portfolio - now also 60% off
Two members of DraftKings’ board of directors bought company stock on the open market Nov. 11, days after the online sportsbook reported financial results that missed Wall Street forecasts across the board, sending the share price down as much as 10%. While the share price has recovered a bit, it is still down 17% since the end of October and near a 52-week low.
Former Metro-Goldwyn-Mayer CEO Harry Sloan, who has been on the board of DraftKings since April 2020, used the decline to buy 25,000 shares at $30.30 each, for a total purchase of $757,500, according to a regulatory filing with the U.S. Securities and Exchange Commission (SEC). The transaction brought the number of DKNG shares Sloan now owns to 249,712, worth $7.87 million at the current market price.
New Board Member
Sloan wasn’t the only DraftKings board member to buy the dip. Also on Nov. 11, new board member Gregory Wendt made his first purchase of DKNG stock since joining the company in late October. Wendt bought 10,000 shares for $30.27 each, for a total of $302,700.
Both purchases by the board members were made with DKNG stock near its 52-week low of $26.23 per share. The online sportsbook has struggled with increased competition and heavy spending on advertising and marketing as it tries to increase its share of the fast-growing sports gambling sector. DKNG stock is down 20% this year.
Is DKNG Stock a Buy?
The stock of DraftKings has a consensus Strong Buy rating among 28 Wall Street analysts. That rating is based on 24 Buy and four Hold recommendations issued in the last three months. The average DKNG price target of $44.74 implies 50.69% upside from current levels.
