Why Investors Are Dumping DraftKings Stock Tuesday
Portfolio Pulse from Adam Eckert
DraftKings Inc (NASDAQ:DKNG) shares dropped following an exclusive online sports betting deal between PENN Entertainment Inc (NASDAQ:PENN) and ESPN. The deal gives Penn exclusive rights to the ESPN Bet trademark for online sports betting in the U.S. for an initial 10-year term. Penn also sold 100% of the Barstool Sports common stock back to Dave Portnoy. Penn will pay ESPN, which is 80% owned by Walt Disney Co (NYSE:DIS), $1.5 billion for the initial 10-year term and grant ESPN approximately $500 million in warrants to purchase 31.8 million shares of Penn common stock.
August 08, 2023 | 9:38 pm
News sentiment analysis
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NEGATIVE IMPACT
DraftKings shares dropped following the announcement of an exclusive deal between PENN and ESPN, which are competitors in the online sports betting space.
The exclusive deal between PENN and ESPN could potentially limit DraftKings' market share in the online sports betting space, leading to a drop in its stock price.
CONFIDENCE 90
IMPORTANCE 80
RELEVANCE 100
POSITIVE IMPACT
Disney, which owns 80% of ESPN, may see a positive impact due to the deal between PENN and ESPN.
As Disney owns 80% of ESPN, the deal with PENN could potentially increase Disney's revenues, leading to a positive impact on its stock price.
CONFIDENCE 80
IMPORTANCE 70
RELEVANCE 80
POSITIVE IMPACT
PENN's stock may rise due to the exclusive deal with ESPN for online sports betting rights in the U.S.
The exclusive deal with ESPN could potentially increase PENN's market share in the online sports betting space, leading to a rise in its stock price.
CONFIDENCE 90
IMPORTANCE 80
RELEVANCE 100