Shares of sports-betting company DraftKings have slipped to 52-week lows, and three directors recently bought a total of $2.6 million of shares.
Gabby Jones/Bloomberg
DraftKings stock has slumped this year, but three directors recently bought $2.6 million of shares of the sports-betting company.
These are the first open-market purchases of stock by insiders since DraftKings went public in early 2020 through a special-purpose acquisition company.
DraftKings (ticker: DKNG) stock has slipped 23% so far this year, setting a new 52-week intraday low of $34.42 just last week. Meanwhile the S&P 500 index has risen by nearly 27%.
The company has faced headwinds as of late. A disappointing third-quarter report earlier this month sent shares tumbling. Near the end of October, DraftKings dropped a $22 billion bid for Entain , a deal that would have provided bricks-and-mortar betting sites in the U.K., and a foothold in online international gambling.
DraftKings director and Vice Chairman Harry E. Sloan led the buying, paying $2 million on Nov. 16 for 50,000 shares, a per-share average price of $39.52. Sloan, a former chairman and CEO of motion picture and television company Metro-Goldwyn-Mayer, now owns 63,035 shares, according to a form he filed with the Securities and Exchange Commission. He received his other DraftKings shares through vested restricted stock units awarded for his board service.
DraftKings provided comment from Sloan as well as the other two directors.
Sloan, a backer of the SPAC that brought DraftKings public, said: “I am confident in DraftKings’ growth trajectory and leading position in the U.S. gaming market. I remain excited in the long-term opportunity DraftKings presents and [CEO] Jason [Robins] and his management team’s ability to deliver on their compelling vision for the company’s future.”
Director Steven J. Murray paid $366,600 on Nov. 19 for 10,000 DraftKings shares, a per-share average price of $36.66. The managing partner of venture-capital firm Revolution Growth and former SoftBank executive now owns 28,154 shares, including some received in a distribution from a limited partnership.
Murray said: “DraftKings has tremendous long-term growth potential. The company’s leadership is focused on maintaining a leading position in the U.S. gaming market while simultaneously exploring potential opportunities to expand into new verticals.”
Director Woody Levin paid $260,000 on Nov. 18 for 7,000 shares, an average price of $36.81 each. Levin, an investor and former DocuSign (DOCU) executive, now owns 19,495 shares in a personal account, and another 44,616 shares through a family trust.
Levin said: “This was an opportunity to increase my position in DraftKings. Yes, I personally view it as an attractive price but most importantly I have enormous trust in Jason and his leadership team to continue to drive performance in the company’s core product offerings while building out several exciting new organic growth opportunities.”
Inside Scoop is a regular Barron’s feature covering stock transactions by corporate executives and board members—so-called insiders—as well as large shareholders, politicians, and other prominent figures. Due to their insider status, these investors are required to disclose stock trades with the Securities and Exchange Commission or other regulatory groups.
Write to Ed Lin at edward.lin@barrons.com and follow @BarronsEdLin.
Source: finance.yahoo.com