Key insights
- MoffettNathanson downgraded DraftKings and Flutter Entertainment to Neutral, citing valuation concerns despite previous bullish outlooks. The downgrades follow significant stock declines from 2024 highs, with further losses in early 2025. This news has exerted minor downward pressure on the gambling sector, with DraftKings and Penn Entertainment experiencing declines.
Investing.com -- DraftKings Inc. (NASDAQ: DKNG) shares declined Monday after MoffettNathanson downgraded the stock to Neutral from Buy, alongside a similar downgrade for Flutter Entertainment (NYSE: FLUT).
DraftKings fell 1.49%, while Flutter dropped 0.80%. Penn Entertainment (NASDAQ: PENN) declined 1.16%, and Super Group (NYSE: SGHC) rose 0.40%.
"We admit that we are very late to downgrading DKNG and FLUT at this point. The stocks have sold off from the highs of last year and taken another material step down so far this year. But in the end, our core belief that the valuation of both companies is so attractive – even on conservative longer-term forecasts – is no longer enough to maintain our Buy recommendations," MoffettNathanson analysts commented.
The downgrades come after both stocks experienced significant declines from their 2024 highs, with further losses recorded in early 2025. The analyst firm acknowledged the timing of the rating changes, noting the stocks had already retreated substantially before the downgrades were issued.