DraftKings has now fallen 10% in the month since the last note, landing at $23.85 — and the Street's response this week has been to cut targets rather than hold the line.
The analyst tone has shifted since the July 15 note. That piece flagged broad target-raising as the central tension. This week the direction reversed. Stifel trimmed its target to $38 from $40 on Wednesday, maintaining Buy. Truist Securities and Wells Fargo both cut to $29 — from $30 and $32 respectively — also holding constructive ratings. The mean target has slipped to $34.93, still about 46% above the current price, but the gap is narrowing as targets drift down to meet the falling stock. No firm has downgraded its rating. The message from bulls is that the thesis is intact; the price just moved too far, too fast.
Options positioning is the clearest counter-signal to that bullishness. The put/call ratio has dropped to 0.39 — its lowest reading in the past year and more than one standard deviation below its 20-day average of 0.41. That points to unusually heavy call-side activity relative to puts, meaning options traders are leaning bullish even as the stock falls. With earnings confirmed for August 6, the skew likely reflects positioning for a bounce on the print rather than directional conviction about the business.
Short interest tells a calmer story than the price action implies. Bears hold 8.3% of the free float — a meaningful level, but one that has actually edged lower over the past week, down about 1.5% in share terms. Borrow conditions are loose: the cost to borrow has fallen 12% on the week to just 0.39%, and availability is very wide at over 1,400% — more than fourteen shares available to borrow for every one currently on loan. There is no sign of a squeeze setup. Shorts are not adding aggressively, and the lending market gives them no reason to cover.
Factor positioning adds a useful layer. Forward EPS growth ranks in the 94th percentile of the universe — the bull case rests on a dramatic earnings inflection, not on current profitability. EPS momentum over 30 and 90 days scores in the mid-70s, supporting the idea that estimate revisions have been running in the right direction. The short score at 47.3 has drifted slightly lower over the week from above 48, consistent with the modest short-covering seen in the raw shares data. Institutional holders remain broadly stable: AQR added roughly 6.5 million shares in Q1, and Janus Henderson and Capital Research each added around 2 million, though those filings are now a quarter old.
The pattern around past earnings is worth flagging ahead of August 6. The most recent Q1 print in May produced a one-day gain of 6.7% and a five-day gain of 5.1%. The prior quarter saw a modest decline. The average reaction has been asymmetric to the upside, which may explain the call-heavy options positioning. The key question at the August print — with bears still holding 8.3% of the float and analysts clustered between $29 and $38 — is whether reported revenue growth and any guidance update are enough to close the gap between where the stock is trading and where the Street thinks it belongs.
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