DraftKings has dropped 13% over the past month to $25.21, yet the Street is quietly lifting its targets — a split worth unpacking heading into August earnings.
The analyst move this week is the standout. JP Morgan's Daniel Politzer raised his target to $34 from $31 on Tuesday, maintaining Overweight. That follows TD Cowen lifting to $35 from $30 just days earlier. Deutsche Bank moved its Hold target up to $28 from $26, while Citizens and Guggenheim had already nudged targets higher in late June. The direction of travel is clear: most analysts are taking numbers up, not down, even as the stock slides. The mean price target now stands near $35.20 — roughly 40% above the current price. UBS remains an outlier with a $49 target. That gap between price action and analyst sentiment is the central tension this week.
Short interest and borrow conditions reinforce the picture of a stock with genuine bears, but not a panicked one. Short interest has crept up about 9% over the past month to 8.4% of the free float — a meaningful level for a large-cap consumer name. The week-on-week change is small at just over 1%, so shorts are rebuilding gradually rather than piling in aggressively. The lending market is relaxed: cost to borrow is around 0.44%, essentially near-zero in real terms, and availability is exceptionally loose at over 1,100% of short interest. That means there are more than eleven shares available to borrow for every one currently shorted — no squeeze mechanics here. Options positioning echoes the same calm. The put/call ratio of 0.40 is fractionally below its 20-day average and sits near the low end of its 52-week range; call interest is actually edging out puts, which reads as mildly constructive rather than defensive.
The bull-versus-bear debate is sharply defined. Bulls point to DraftKings' expanding prediction market ecosystem and exchange acquisition as evidence that the company is building platform control rather than simply chasing handle. Forward EPS growth ranks in the 95th percentile, a reflection of the dramatic improvement in profitability expectations baked into consensus. Bears counter with the operational reality: EBITDA was still negative as of June, at approximately -$35 million, and the growth story remains tethered to state-by-state legalization timelines that the company does not control. The EV/EBITDA multiple of 14.4x has compressed modestly over the past 30 days, consistent with the stock de-rating while earnings estimates hold. Short score sits at 48 out of 100 — mid-range, broadly neutral, and stable across the past two weeks.
Earnings history provides a useful frame for what's ahead. The last Q1 print in May produced a 6.7% next-day gain. The print before that fell 2.8%. Over the past four reported quarters the stock has moved an average of roughly 4% the next day in either direction — modest given the valuation premium and the binary state-legalization element. Institutional ownership is stable. Janus Henderson and Capital Research both added meaningfully in Q1, each holding above 5% of shares. AQR Capital built a notable position of 4.5% of shares, adding over 6.5 million shares in Q1.
The Q2 print on August 6 is the next hard catalyst — what to watch is whether management narrows the path to sustained EBITDA profitability, and whether prediction market volumes provide the incremental growth narrative the Street needs to close the gap between $25 and those freshly raised targets.
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