MoffettNathanson Downgrades DraftKings and Flutter Ratings to Neutral
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1 hour ago
0mins
Should l Buy DKNG?
Source: seekingalpha
- Rating Downgrade: MoffettNathanson has downgraded DraftKings and Flutter Entertainment from Buy to Neutral, citing that while both companies have attractive valuations based on conservative long-term forecasts, a significant overhang exists due to the lack of regulatory clarity impacting these sports betting stocks.
- Regulatory Uncertainty: The U.S. prediction market is in a rapidly evolving yet unsettled regulatory environment, with the CFTC moving towards a formal framework that includes a March 12 advance notice of proposed rulemaking and staff advisory, while also withdrawing an earlier proposal that could have tightened limits on sports and politics-related contracts.
- Increased Market Pressure: State regulators and litigants are aggressively challenging the industry, particularly where contracts overlap with gambling or sports betting, resulting in a patchwork of federal oversight, active rulemaking, and ongoing state-level legal pressures that complicate the market landscape.
- Weak Stock Performance: Both DraftKings and Flutter have seen their stock prices decline by over 30% since the beginning of the year, as trading volumes in prediction markets continue to exceed expectations during major sporting events, indicating market concerns about future developments.
Trade with 70% Backtested Accuracy
Stop guessing "Should I Buy DKNG?" and start using high-conviction signals backed by rigorous historical data.
Sign up today to access powerful investing tools and make smarter, data-driven decisions.
Analyst Views on DKNG
Wall Street analysts forecast DKNG stock price to rise
29 Analyst Rating
23 Buy
6 Hold
0 Sell
Strong Buy
Current: 22.170
Low
30.00
Averages
42.69
High
53.00
Current: 22.170
Low
30.00
Averages
42.69
High
53.00
About DKNG
DraftKings Inc. is a digital sports entertainment and gaming company. It provides users with online and retail sports betting (together, Sportsbook), online casino (iGaming) and daily fantasy sports product offerings, as well as digital lottery courier, media, and other product offerings. Sportsbook is live with mobile and/or retail sports betting operations pursuant to regulations in 28 states, Washington, D.C., and in Ontario, Canada. It operates iGaming pursuant to regulations in five states and in Ontario, Canada under its DraftKings brand and pursuant to regulations in four states under its Golden Nugget Online Gaming brand. It owns Jackpocket, a digital lottery courier app in the United States. It is both an official daily fantasy and sports betting partner of the NFL, NHL, PGA TOUR, WNBA and UFC, as well as an official daily fantasy partner of NASCAR, an official sports betting partner of the NBA. It also owns and operates DraftKings Network, a multi-platform content ecosystem.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
DraftKings to Release Q1 2026 Results and Host Conference Call
- Earnings Release Schedule: DraftKings will announce its Q1 2026 results after market close on May 7, 2026, reflecting the company's latest performance in the digital sports entertainment and gaming sector.
- Conference Call Details: The company will host a conference call on May 8, 2026, at 8:30 a.m. ET, where management will discuss the earnings results and provide commentary on business performance, enhancing investor confidence in the company's future.
- Investor Relations Website: Investors can listen to the audio webcast and live Q&A through DraftKings' investor relations website, ensuring transparency and fostering interaction with investors, with the audio available until June 30, 2026.
- Company Background: Founded in 2012 and headquartered in Boston, DraftKings is the only U.S.-based vertically integrated sports betting operator, committed to enhancing the competitive spirit of sports fans through a diverse range of real-money games and betting experiences.
See More
Rise of Prediction Market ETFs: Key Insights
- ETF Innovation: Bitwise, Roundhill, and GraniteShares have filed with the SEC to launch event contract ETFs, enabling investors to wager on the outcomes of the 2028 presidential election within self-directed IRAs, addressing strong market interest in prediction markets.
- Market Potential: These ETFs will track changes in prediction market probabilities, allowing investors to engage in Democrat or Republican president ETFs, which are expected to attract significant attention and liquidity.
- Risk Warning: SEC filings indicate that if outcomes contradict the bets, the fund will “lose substantially all its value,” highlighting the need for investors to approach such high-risk investment products with caution.
- Market Regulation: The legality of prediction markets is facing legal challenges nationwide, with the Commodity Futures Trading Commission involved in the legal fight to uphold its regulatory authority over event contracts, illustrating the complexities of market regulation.
See More
MoffettNathanson Downgrades DraftKings and Flutter Ratings to Neutral
- Rating Downgrade: MoffettNathanson has downgraded DraftKings and Flutter Entertainment from Buy to Neutral, citing that while both companies have attractive valuations based on conservative long-term forecasts, a significant overhang exists due to the lack of regulatory clarity impacting these sports betting stocks.
- Regulatory Uncertainty: The U.S. prediction market is in a rapidly evolving yet unsettled regulatory environment, with the CFTC moving towards a formal framework that includes a March 12 advance notice of proposed rulemaking and staff advisory, while also withdrawing an earlier proposal that could have tightened limits on sports and politics-related contracts.
- Increased Market Pressure: State regulators and litigants are aggressively challenging the industry, particularly where contracts overlap with gambling or sports betting, resulting in a patchwork of federal oversight, active rulemaking, and ongoing state-level legal pressures that complicate the market landscape.
- Weak Stock Performance: Both DraftKings and Flutter have seen their stock prices decline by over 30% since the beginning of the year, as trading volumes in prediction markets continue to exceed expectations during major sporting events, indicating market concerns about future developments.
See More
Morgan Stanley: Earnings Season to Surprise with Positive Data
- Earnings Season Performance: By April 17, 10% of S&P 500 companies had reported Q1 earnings, with 88% exceeding EPS expectations and 84% surpassing revenue forecasts, indicating robust financial health that is likely to attract more investor interest.
- Signs of Earnings Recovery: Morgan Stanley's chief U.S. equity strategist, Michael Wilson, noted that despite geopolitical risks, the earnings recovery remains intact, primarily driven by positive operating leverage, suggesting growing market confidence in economic recovery.
- Potential Winners: Analysts at Morgan Stanley believe companies like DraftKings and Datadog are poised to exceed expectations on key performance indicators, with DraftKings expected to excel in adjusted EBITDA and Datadog likely to surprise on revenue, enhancing their competitive positions in the market.
- Market Outlook: As more companies prepare to report earnings, Morgan Stanley anticipates additional positive financial data, particularly for those companies that exceed expectations on key performance indicators, which will likely yield disproportionate benefits in the market.
See More
DraftKings Plans Online Betting Launch in Alberta, Canada
- Market Expansion Plan: DraftKings (DKNG) intends to launch its online sports betting and casino products in Alberta on the anticipated universal launch date of July 13, contingent on obtaining necessary licensing and regulatory approvals, thereby increasing its operational provinces in Canada to two and expanding its market reach.
- North American Market Positioning: Alberta will become the 34th jurisdiction in North America where DraftKings offers online sports betting and the seventh with online casino services, highlighting the company's strategic positioning in the rapidly growing online gambling market.
- Population Advantage: With a population of over 5 million, Alberta represents a larger market than Los Angeles and is close in size to Colorado, providing DraftKings with a significant customer base that is expected to drive user growth and revenue enhancement.
- World Cup Opportunity: DraftKings VP Greg Karamitis noted that the anticipated launch aligns with the World Cup hosted in North America, presenting an exciting opportunity for sports fans in Alberta to engage with their platform, thereby enhancing market appeal.
See More
U.S. Stocks Edge Up as PepsiCo and TSMC Shine
- PepsiCo's Quarter Performance: PepsiCo achieved its first volume growth in North American food business in two years, with CEO Ramon Laguarta addressing the industry's threat from GLP-1 weight-loss drugs, leading to a 1% rise in shares, demonstrating the company's resilience and adaptability in a competitive consumer goods market.
- TSMC Profit Surge: TSMC reported a 58% year-over-year profit increase, despite facing challenges with shortages of industrial gases; management noted a 'little bit softer' memory pricing, indicating ongoing demand and competitive pressures in advanced chip manufacturing that could impact future profitability.
- J.B. Hunt Transport Services: J.B. Hunt indicated the start of a new cycle with positive demand signals, reporting a first-quarter earnings beat and a 1% premarket share increase, reflecting potential growth opportunities in the transportation sector.
- Analyst Rating Changes: JPMorgan downgraded Corning to hold and cut its price target from $175 to $115, citing the need for greater earnings visibility to support stock upside, indicating a cautious market outlook on the company's future performance.
See More
DraftKings to Release Q1 2026 Results and Host Conference Call
- Earnings Release Schedule: DraftKings will announce its Q1 2026 results after market close on May 7, 2026, reflecting the company's latest performance in the digital sports entertainment and gaming sector.
- Conference Call Details: The company will host a conference call on May 8, 2026, at 8:30 a.m. ET, where management will discuss the earnings results and provide commentary on business performance, enhancing investor confidence in the company's future.
- Investor Relations Website: Investors can listen to the audio webcast and live Q&A through DraftKings' investor relations website, ensuring transparency and fostering interaction with investors, with the audio available until June 30, 2026.
- Company Background: Founded in 2012 and headquartered in Boston, DraftKings is the only U.S.-based vertically integrated sports betting operator, committed to enhancing the competitive spirit of sports fans through a diverse range of real-money games and betting experiences.
See More
Rise of Prediction Market ETFs: Key Insights
- ETF Innovation: Bitwise, Roundhill, and GraniteShares have filed with the SEC to launch event contract ETFs, enabling investors to wager on the outcomes of the 2028 presidential election within self-directed IRAs, addressing strong market interest in prediction markets.
- Market Potential: These ETFs will track changes in prediction market probabilities, allowing investors to engage in Democrat or Republican president ETFs, which are expected to attract significant attention and liquidity.
- Risk Warning: SEC filings indicate that if outcomes contradict the bets, the fund will “lose substantially all its value,” highlighting the need for investors to approach such high-risk investment products with caution.
- Market Regulation: The legality of prediction markets is facing legal challenges nationwide, with the Commodity Futures Trading Commission involved in the legal fight to uphold its regulatory authority over event contracts, illustrating the complexities of market regulation.
See More
MoffettNathanson Downgrades DraftKings and Flutter Ratings to Neutral
- Rating Downgrade: MoffettNathanson has downgraded DraftKings and Flutter Entertainment from Buy to Neutral, citing that while both companies have attractive valuations based on conservative long-term forecasts, a significant overhang exists due to the lack of regulatory clarity impacting these sports betting stocks.
- Regulatory Uncertainty: The U.S. prediction market is in a rapidly evolving yet unsettled regulatory environment, with the CFTC moving towards a formal framework that includes a March 12 advance notice of proposed rulemaking and staff advisory, while also withdrawing an earlier proposal that could have tightened limits on sports and politics-related contracts.
- Increased Market Pressure: State regulators and litigants are aggressively challenging the industry, particularly where contracts overlap with gambling or sports betting, resulting in a patchwork of federal oversight, active rulemaking, and ongoing state-level legal pressures that complicate the market landscape.
- Weak Stock Performance: Both DraftKings and Flutter have seen their stock prices decline by over 30% since the beginning of the year, as trading volumes in prediction markets continue to exceed expectations during major sporting events, indicating market concerns about future developments.
See More
Morgan Stanley: Earnings Season to Surprise with Positive Data
- Earnings Season Performance: By April 17, 10% of S&P 500 companies had reported Q1 earnings, with 88% exceeding EPS expectations and 84% surpassing revenue forecasts, indicating robust financial health that is likely to attract more investor interest.
- Signs of Earnings Recovery: Morgan Stanley's chief U.S. equity strategist, Michael Wilson, noted that despite geopolitical risks, the earnings recovery remains intact, primarily driven by positive operating leverage, suggesting growing market confidence in economic recovery.
- Potential Winners: Analysts at Morgan Stanley believe companies like DraftKings and Datadog are poised to exceed expectations on key performance indicators, with DraftKings expected to excel in adjusted EBITDA and Datadog likely to surprise on revenue, enhancing their competitive positions in the market.
- Market Outlook: As more companies prepare to report earnings, Morgan Stanley anticipates additional positive financial data, particularly for those companies that exceed expectations on key performance indicators, which will likely yield disproportionate benefits in the market.
See More
DraftKings Plans Online Betting Launch in Alberta, Canada
- Market Expansion Plan: DraftKings (DKNG) intends to launch its online sports betting and casino products in Alberta on the anticipated universal launch date of July 13, contingent on obtaining necessary licensing and regulatory approvals, thereby increasing its operational provinces in Canada to two and expanding its market reach.
- North American Market Positioning: Alberta will become the 34th jurisdiction in North America where DraftKings offers online sports betting and the seventh with online casino services, highlighting the company's strategic positioning in the rapidly growing online gambling market.
- Population Advantage: With a population of over 5 million, Alberta represents a larger market than Los Angeles and is close in size to Colorado, providing DraftKings with a significant customer base that is expected to drive user growth and revenue enhancement.
- World Cup Opportunity: DraftKings VP Greg Karamitis noted that the anticipated launch aligns with the World Cup hosted in North America, presenting an exciting opportunity for sports fans in Alberta to engage with their platform, thereby enhancing market appeal.
See More
U.S. Stocks Edge Up as PepsiCo and TSMC Shine
- PepsiCo's Quarter Performance: PepsiCo achieved its first volume growth in North American food business in two years, with CEO Ramon Laguarta addressing the industry's threat from GLP-1 weight-loss drugs, leading to a 1% rise in shares, demonstrating the company's resilience and adaptability in a competitive consumer goods market.
- TSMC Profit Surge: TSMC reported a 58% year-over-year profit increase, despite facing challenges with shortages of industrial gases; management noted a 'little bit softer' memory pricing, indicating ongoing demand and competitive pressures in advanced chip manufacturing that could impact future profitability.
- J.B. Hunt Transport Services: J.B. Hunt indicated the start of a new cycle with positive demand signals, reporting a first-quarter earnings beat and a 1% premarket share increase, reflecting potential growth opportunities in the transportation sector.
- Analyst Rating Changes: JPMorgan downgraded Corning to hold and cut its price target from $175 to $115, citing the need for greater earnings visibility to support stock upside, indicating a cautious market outlook on the company's future performance.
See More
