We wouldn't blame DraftKings Inc. (NASDAQ:DKNG) shareholders if they were a little worried about the fact that Harry Sloan, the Independent Vice Chairman of the Board recently netted about US$9.5m selling shares at an average price of US$38.15. That's a big disposal, and it decreased their holding size by 31%, which is notable but not too bad.
DraftKings Insider Transactions Over The Last Year
The Co-Founder, Jason Robins, made the biggest insider sale in the last 12 months. That single transaction was for US$17m worth of shares at a price of US$36.07 each. So it's clear an insider wanted to take some cash off the table, even below the current price of US$43.25. When an insider sells below the current price, it suggests that they considered that lower price to be fair. That makes us wonder what they think of the (higher) recent valuation. Please do note, however, that sellers may have a variety of reasons for selling, so we don't know for sure what they think of the stock price. This single sale was just 11% of Jason Robins's stake.
Insiders in DraftKings didn't buy any shares in the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
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Insider Ownership Of DraftKings
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. We usually like to see fairly high levels of insider ownership. It's great to see that DraftKings insiders own 2.4% of the company, worth about US$494m. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.
So What Does This Data Suggest About DraftKings Insiders?
An insider sold DraftKings shares recently, but they didn't buy any. And even if we look at the last year, we didn't see any purchases. It is good to see high insider ownership, but the insider selling leaves us cautious. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. Every company has risks, and we've spotted 2 warning signs for DraftKings you should know about.
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For the purposes of this article, insiders are those individuals who report their transactions to the relevant regulatory body. We currently account for open market transactions and private dispositions of direct interests only, but not derivative transactions or indirect interests.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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