DraftKings heads into its Q1 2026 earnings today with options traders making the most aggressively bullish bet of the past year.
The options market is the standout heading into the print. The put/call ratio collapsed to 0.388 on Monday — the lowest reading in the past 52 weeks, two full standard deviations below the 20-day average of 0.43. That is not a hedge; it is a directional call-side bet. The stock pulled back 4% on Monday to $24.51, yet traders used that dip to load up on upside exposure rather than protection. Over the past month DKNG has recovered 10%, and options positioning suggests at least some investors are leaning into further gains from the print.
Short interest complicates the picture slightly. Bears hold a genuine position — 8.4% of the free float is short, and that figure has climbed roughly 10% over the past month as shares moved higher, a classic fade of the rally. Days to cover sits at 3.3. Yet the lending market shows no signs of stress: cost to borrow runs at just 0.44%, and borrow availability remains loose, with the lending pool well short of capacity relative to its 52-week peak utilization. Short sellers have added exposure, but they are not being squeezed into covering.
The analyst debate heading in leans constructive but with caveats. The Street collectively targets $35.13 against Monday's close of $24.51 — roughly 43% implied upside — and the activity heading into today's print has been broadly supportive. Barclays raised its target to $35 on Monday. Needham reiterated its Buy. Those moves contrast with MoffettNathanson's downgrade to Neutral in late April, which accompanied a sharp target cut to $27 from $38, citing concerns that growth assumptions had been trimmed and that competition and regulatory complexity in the online gambling space remain underappreciated risks. JPMorgan maintained Overweight but shaved its target twice in April, settling at $31 — a signal that even bulls are calibrating for a softer near-term trajectory. The bull case rests on DraftKings' market-share leadership, its Canadian expansion, and the argument that the stock's depressed multiple understates the platform's long-term earnings power. Bears point to conservative guidance, execution risk, and a crowded competitive landscape.
Insider activity adds a modest note of caution. The CFO sold shares at $23 in May, and co-founder Paul Liberman offloaded roughly $12 million worth in March. Net insider activity over 90 days is technically positive in share terms, largely reflecting stock awards rather than open-market purchases — the clean buying signal is absent. The print will test whether the company can show a revenue and margin trajectory that closes the gap between the $24 stock and the $35 consensus target, or whether MoffettNathanson's more sceptical framing of the competitive outlook proves better-timed.
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