DraftKings Stock Heading for Worst Day of 2022

Year-over-year, DKNG is now down more than 72%

Digital Content Manager
Nov 4, 2022 at 11:23 AM
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DraftKings Inc (NASDAQ:DKNG) is down 23.6% to trade at $11.98, despite the sports betting company reporting better-than-expected third-quarter results and raising its revenue outlook. What's instead weighing on the stock is DraftKings' 2023 adjusted loss coming in bigger than analysts had expected, with the company noting a struggling economy could lead consumers to spend less on the platform.

DraftKings stock is heading toward its worst single-session drop of 2022, and is set to close at its lowest level since July 15. Year-over-year, DKNG is down a hefty 72.9%, and the shares aren't far off their May 12, three-year low of $9.77. 

Somehow, analysts remain optimistic toward DraftKings stock, with 12 of the 20 firms in question calling it a "buy" or better, and only one "sell" on the books. Plus, the 12-month consensus target price of $24.67 is a 104.6% premium to DKNG's current levels, indicating downgrades and/or price-target cuts could be on the horizon.

Drilling down to today's options activity, 98,000 calls and 64,000 puts are across the tape, or four times the average intraday volume. Most popular is the 11/4 12.50-strike  put, where new positions are now being opened, followed by the 11/11 11.50-strike put. 

This penchant for bullish bets is not unusual, per DraftKings stock's 50-day call/put volume ratio of 2.58 over at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), which ranks higher than 89% of readings from the past 12 months. 

 

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