Bargain Alert: DraftKings Is the Most Oversold It's Ever Been

Core Viewpoint - DraftKings Inc. is experiencing a significant decline in stock value, with its Relative Strength Index (RSI) dropping below 15, indicating the stock is extremely oversold, which is a rare occurrence in its history [1][2][9] Group 1: Stock Performance - DraftKings shares have fallen over 30% in the past five weeks, with the current price at $32.79, down 6.85% [2] - The stock's 52-week range is between $29.64 and $53.61, with a price target of $53.28 suggesting a potential upside of 62.89% [2][10] - A bounce in share price on October 8 indicates that larger investors may be starting to accumulate shares at a discount [6] Group 2: Market Conditions - The broader tech market is at or near all-time highs, contrasting sharply with DraftKings' performance, which is causing concern among investors [2] - The current sell-off is attributed to increased competition, profit-taking, and cautious analyst downgrades [4][5] - Despite the stock's decline, the overall market sentiment remains strong, particularly in discretionary sectors like entertainment [9] Group 3: Fundamental Analysis - DraftKings reported nearly 40% year-over-year revenue growth in its most recent earnings report, exceeding analyst expectations [7][8] - Analysts from Berenberg and Mizuho have upgraded their ratings, citing the company's growth and margin expansion as key factors, with Berenberg's price target at $43 [10][11] - Institutional investors, such as ARK Invest, are increasing their positions in DraftKings, indicating confidence in the company's long-term prospects [12] Group 4: Future Outlook - The RSI below 15 suggests that the stock may be due for a rebound, especially given the solid fundamentals [9][13] - If DraftKings can maintain its price above $33 leading into upcoming earnings, it could signal a recovery [14]