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DraftKings Drop Continues; Some Analysts Say Buy the Dip

DraftKings shares have been falling since Friday's earnings report. Goldman trimmed its price target while Berenberg upgraded the stock to hold.
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DraftKings  (DKNG) - Get DraftKings Inc. Report shares on Wednesday continued their post-earnings-report slide, and some analysts suggested buying the dip in the sports-betting company.

At last check the stock was off 2.4% at $42.97. The stock had closed at $51.89 on Thursday, the day before the company reported.

Goldman Sachs analyst Stephen Grambling trimmed his price target on the Boston company to $77 a share from $88.

He called on investors to buy the dip in the stock, Bloomberg News reported. 

Grambling sees growth for the sports-betting market fueled by stronger-than-expected increases in monthly users and higher spending per user. And he sees DraftKings sustaining its market share. 

Read More: Buy the Earnings Dip in DraftKings? Check Out This Chart

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In late January Grambling had lifted his rating on DraftKings to buy from neutral.

Meanwhile, Berenberg analyst Jack Cummings upgraded DraftKings to hold from sell as the current drop in share prices has removed most of the risk to investors.  The analyst cited DraftKings' better-than-expected first-quarter results. 

Soaring revenue helped the company top estimates last week. 

DraftKings reported a loss of $346.3 million, or 87 cents a share, compared with a year-earlier loss of $68.7 million, or 37 cents a share. 

The latest adjusted loss came to 36 cents a share. Analysts surveyed by FactSet had forecast a first-quarter adjusted loss of 43 cents a share.

Revenue totaled $312.3 million, more than triple (up 253%) the year-earlier figure and beating the consensus analyst estimate of $236.2 million.

Monthly unique payers more than doubled (increased 114%) to 1.5 million, topping the average analyst forecast of 1.19 million.