Who is Adjusting their DraftKings (NASDAQ:DKNG) Stake, Because of the

On Sep 30, 2021

This article was originally published on Simply Wall St News

DraftKings (NASDAQ:DKNG) is having a volatile few months and the stock is currently down 20.79% from six months ago. It seems that the company is still establishing its business and would be hard to find a fundamental baseline. Sometimes, looking at large trading activity is more informative, especially for younger companies. That is why, we will review which large players are optimistic for the stock and get a better indication of the potential for DraftKings.

While we would never suggest that investors should base their decisions solely on what institutions and insiders have been doing, logic dictates you should pay some attention to whether they are buying or selling shares.

See our latest analysis for DraftKings

The Last 12 Months Of Insider Transactions At DraftKings

In the last twelve months, the biggest single sale by an insider was when the Director, Shalom Meckenzie, sold US$353m worth of shares at a price of US$50.83 per share. The sale was almost a year ago, but seeing an insider sell at around the current price of US$48.3 still presents a point of inquiry.

In this case, the big sale took place at around the current price, so it’s not too bad (but it’s still not a positive). Shalom Meckenzie was the only individual insider to sell shares in the last twelve months and still retains 4.71% of the company as of 13 September 2021.

The company also saw some increased trading activity in the last three months. The balanced mix of buying and selling shows that companies are still fighting over the positioning on DraftKings, and we will also take a look at the biggest trades made recently.

You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

It seems that the large financial institutions are either adjusting or initiating new positions on DraftKings. In the small example below, we see bullish activity from Wellington Management Group and Credit Suisse, while BlackRock has sold some of their position.

The list below is not comprehensive, and we have the extended version in the DraftKings Report HERE.

Knowing which institutions are backing DraftKings helps with estimating the long term potential and expected volatility of the stock.

Mergers & Acquisitions Are The Possible Reason Behind The Trading Shift

The probable main reason behind all this trading may be the recent bid by Jason Robins, the company CEO, to acquire Entain (LSE:ENT). Mergers & Acquisitions can be messy as the offers change and are accepted or rejected by the target company, and this will no doubt change the price outlook for DraftKings in the next few days, especially because this is set out to be an acquisition of “equals” at least in market cap terms.

Acquisitions are hard to pull of, and it is even harder not to…