Shares of DraftKings Inc DKNG hit a new high of $64.19 on Oct. 2. An offering has sent shares lower.
What Happened: DraftKings announced Monday it was selling 32 million shares. The company is selling 16 million new shares with existing shareholders selling 16 million. The company is also offering 4.8 million shares to underwriters.
Late Tuesday, shares were priced at $52 for the offering, which was significantly lower than the company’s share price of $60.55 when it announced it was selling shares.
Why It's Important: The pressure on DraftKings comes as the NFL faces uncertainty. The game between the Tennessee Titans and Pittsburgh Steelers was postponed last week after several positive COVID-19 tests in the Tennessee organization. An additional player has tested positive this week for the Titans.
New England Patriots CB Stephen Gilmore tested positive for COVID-19 on Wednesday, which marks the third Patriots player. He played in Monday night’s game, which had already been moved from Sunday after two players tested positive on the team late last week.
ESPN also reports that a player on the Las Vegas Raiders has tested positive.
What's Next: A lock-up period expires on Oct. 20 for some existing DraftKings shareholders, which could put more pressure on shares.
In its share offering prospectus, DraftKings listed projected third-quarter revenue of $131-$133 million, growth of over 40% year-over-year.
DraftKings also reported online sports betting handle up 460% year-over-year in the third quarter, including a 110% year-over-year increase in New Jersey. The company saw online casino handle rise 335% year-over-year in the third quarter.
DKNG Price Action: DraftKings shares were down 6% on Tuesday to $56.78. Shares are down 8% to $52.20 early Wednesday morning.
© 2022 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Ad Disclosure: The rate information is obtained by Bankrate from the listed institutions. Bankrate cannot guaranty the accuracy or availability of any rates shown above. Institutions may have different rates on their own websites than those posted on Bankrate.com. The listings that appear on this page are from companies from which this website receives compensation, which may impact how, where, and in what order products appear. This table does not include all companies or all available products.
All rates are subject to change without notice and may vary depending on location. These quotes are from banks, thrifts, and credit unions, some of whom have paid for a link to their own Web site where you can find additional information. Those with a paid link are our Advertisers. Those without a paid link are listings we obtain to improve the consumer shopping experience and are not Advertisers. To receive the Bankrate.com rate from an Advertiser, please identify yourself as a Bankrate customer. Bank and thrift deposits are insured by the Federal Deposit Insurance Corp. Credit union deposits are insured by the National Credit Union Administration.
Consumer Satisfaction: Bankrate attempts to verify the accuracy and availability of its Advertisers' terms through its quality assurance process and requires Advertisers to agree to our Terms and Conditions and to adhere to our Quality Control Program. If you believe that you have received an inaccurate quote or are otherwise not satisfied with the services provided to you by the institution you choose, please click here.
Rate collection and criteria: Click here for more information on rate collection and criteria.