Market Pulse: Big Pullbacks in Sports Betting Stocks

    176

    Sports-betting stocks have had giant pullbacks lately. Investors may want to keep an eye on them after the spectacle of the election passes.

    • DraftKings (DKNG) has slid all the way back to its levels from early September. That followed a $1.66 billion stock sale for $52 each on October 7. (Earnings confirmed for the premarket of Friday, November 13.)
    • Penn National Gaming (PENN) is down less, about 31 percent from its peak. PENN, which is associated with David Portnoy and Barstool, reported strong earnings and revenue last week.

    These are small, niche companies with their own unique stories. It’s not a surprise to see them fade as the market focuses on mega-issues like stimulus and control of the White House. They also face the risk of increased coronavirus cases interfering with professional sports.

    Still, investors and analysts view sports betting as a big growth area following its legalization 2-1/2 years ago. And, regardless of the pandemic, we’re still moving into the heart of football season. At a certain point, attention could return to this corner of the market.

    See also: 5 Sports Betting Stocks to Watch Before Football Season Begins

    Advertisement Trading Platforms and Tools

    Previous articleTrump or Biden? Options Traders Are the Real Winners This Year
    Next articleMarket Pulse: Chips Bouncing at the 50-day SMA
    David Russell is VP of Market Intelligence at TradeStation Group. Drawing on nearly two decades of experience as a financial journalist and analyst, his background includes equities, emerging markets, fixed-income and derivatives. He previously worked at Bloomberg News, CNBC and E*TRADE Financial. Russell systematically reviews countless global financial headlines and indicators in search of broad tradable trends that present opportunities repeatedly over time. Customers can expect him to keep them appraised of sector leadership, relative strength and the big stories – especially those overlooked by other commentators. He’s also a big fan of generating leverage with options to limit capital at risk.