Why is dkng a buy

DraftKings (DKNG) is not a compelling buy based on the available financial data and market performance. Here's a detailed analysis to support this conclusion:

1. Negative Valuation Metrics: The company's P/E ratio is negative, indicating that the company is not profitable on a per-share basis. The P/S ratio is reasonable but does not necessarily indicate an undervalued stock on its own. The P/B ratio is high, which could suggest that the market is expecting significant growth to justify the valuation.
2. Recent Performance and Analyst Sentiments: The stock has experienced a significant decline over the last month and has underperformed the market. Analysts have a mixed consensus rating, with some recommending a buy and others recommending hold or sell. The average price target is below the current trading price, suggesting that analysts do not see a significant upside potential in the near term.
3. Earnings and Revenue Trends: The company's earnings are expected to show year-over-year growth, but the growth rate is not exceptional. The revenue growth rate is positive but has been declining over the past quarters.
4. Market Performance and Upcoming Earnings: The stock has underperformed the market over the last month and has experienced a decline over the last three months. The upcoming earnings report is expected to show a significant year-over-year decline in earnings per share.
5. Analyst Forecasts and Price Targets: Short-term price targets from analysts range from a low of $35.00 to a high of $60.00, with an average target of $53.21, which is above the current price. However, these targets are not necessarily indicative of a buy signal since they do not necessarily reflect the current market conditions or future growth prospects.

In conclusion, while some analysts have set higher price targets and there is some expectation of growth, the negative P/E ratio, recent stock performance, and the lack of exceptional earnings and revenue growth do not strongly support a buy recommendation for DKNG. Investors should consider these factors along with their own investment strategy and risk tolerance before making a decision.