Sports betting giants DraftKings Inc (NASDAQ:DKNG) and PENN Entertainment Inc (NASDAQ:PENN) are set to unveil their third-quarter earnings reports tomorrow, with DraftKings presenting its results after the market closes and PENN doing so before the market opens. Additionally, Flutter Entertainment PLC (NYSE:FLUT) is also on the earnings calendar, with its third-quarter figures expected after the closing bell on Wednesday, November 12. As these companies prepare to release their financials, it’s valuable to examine their recent stock performances and the typical market reactions following earnings announcements.
DraftKings has encountered challenging times recently, with its stock down 0.1% at $28.57, marking a significant 23.9% decline this year. The company’s shares have struggled, experiencing their eighth loss in nine trading sessions, even reaching a two-year low of $28.04 after failing to break through the 20-day moving average last month. Historically, DraftKings has had a favorable post-earnings trend, with five out of its last eight earnings sessions leading to an upward spike, including a notable 15.2% increase in February. On average, its stock has moved about 6.3% in the days following earnings reports over the last two years, but this time options traders are anticipating a more substantial 13.9% movement, reflecting increased volatility expectations.
Meanwhile, PENN Entertainment is showing signs of recovery, trading up 2.3% at $16.55, although it remains down 16.8% for the year. The stock has found support around the $16 mark, which has consistently held against its losses, allowing it to rebound after previous dips in August and October. PENN’s post-earnings history isn’t as strong as DraftKings, with the stock closing lower after five of its last eight earnings reports. Traders are pricing in a next-day movement of 10.2% for PENN, compared to its average post-earnings move of 6.8% over the past two years.
Flutter Entertainment, though relatively new to the public market with only five earnings reports since its debut in January 2024, has seen a decline of over 30% in the last three months. The stock is down 2.7% at $215.94 and has experienced a three-day losing streak, facing resistance at the $260 level earlier this month. While its earnings history is limited, Flutter has recorded gains following three of its earnings reports, with an average next-day movement of 5.1%. For the upcoming announcements, options traders expect a slightly larger move of 7.5%.
As these companies prepare to disclose their financial performance, market participants will be closely monitoring not only their results but also the immediate reactions from investors and traders. The landscape for sports betting remains competitive, and these earnings reports could provide valuable insights into how well these companies are navigating current market challenges and shifting consumer behaviors.