Do You Think It Is Time to Buy DraftKings Inc. (DKNG) Stock?

DraftKings (DKNG) was recently a top Zacks.com search. You may wish to investigate some of the important aspects that could affect the stock's performance soon. The Zacks S&P 500 composite returned +4.4% last month, while this company's shares returned -3.7%. The Zacks Gaming industry, which includes DraftKings, fell 0.4%. The main question is: Where may the stock go next?

Media reports or rumors about a company's business prospects frequently cause its stock to trend and change its price, but fundamental factors always drive the buy-and-hold decision.

We base our analysis on how sell-side analysts covering the firm are changing their profit predictions to reflect business movements. Fair value for a company's shares rises with profit projections. When a stock's fair value is higher than its market price, investors buy it, raising its price. Because of this, empirical studies show a substantial link between earnings estimate revisions and short-term stock price changes.

DraftKings is predicted to lose $0.28 per share this quarter, up 67.8% year-over-year. Over 30 days, the Zacks Consensus Estimate has risen 1.7%. The consensus profits projection of -$0.24 for the current fiscal year is up 86.1% from last year. In 30 days, this estimate has changed -9.3%. The consensus profits projection for DraftKings for the next fiscal year is $0.77, up 422.2% from last year. Over a month, the estimate has dropped 13.6%.

Our unique stock grading technique, the Zacks Rank, uses earnings estimate revisions to better predict a stock's near-term price performance and has an exceptional externally verified track record. DraftKings has a Zacks Rank #3 (Hold) due to the latest consensus estimate adjustment and three additional earnings estimate factors.

Earnings growth is the best sign of a company's financial health, but it fails without revenue growth. After all, a corporation can't sustainably boost earnings without expanding revenues. Knowing a company's revenue growth potential is crucial.

DraftKings' consensus sales estimate of $1.12 billion for the quarter is +45.5% year-over-year. Current and next fiscal year predictions are $4.82 billion and $5.73 billion, representing 31.5% and 18.9% increases, respectively.

DraftKings' latest quarter revenues were $1.23 billion, up 43.9% year-over-year. EPS was -$0.10, down from -$0.53 a year earlier. Revenues were +0.74% more than the Zacks Consensus Estimate of $1.22 billion. The EPS surprise was -266.67%.

DraftKings twice exceeded consensus EPS forecasts in the last four quarters. Throughout this period, the company exceeded consensus revenue projections.

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