Sport betting company DraftKings Inc (NASDAQ: DKNG) has partnered with satellite provider DISH Network Corp (NASDAQ: DISH). It means expanded market reach for DraftKings, but why did their stock drop 4.13 %, to $ 65.75, after this news?
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DraftKingsInc (DKNG) gains access to a large audience thanks to the partnership with DISH Network. Those who subscribe to the DISH Network mobile service and STB service will use DraftKing’s services. Currently, viewers of television services have access to an application that lets them predict sporting events. It’s the first such agreement on the market.
While the news appears very positive at first glance, why has the DKNG stock dropped? The main reason for this is the incomplete integration of services. DISH Network subscribers can see the bids made by DraftKings through their mobile app, but you can’t complete the deal without logging in to the app. An automated text message prompts the user to proceed through their DraftKings account. Additionally, betting is only permitted in those states of the US where it is allowed. DraftKings is unlikely to gain significant new customers because of these barriers.
Shares of DraftKingsInc (DKNG) rose 300.67% since the beginning of the year. The stock price soared 9.07% in the last five trades and up 20.33% in the last 30 trades. The share price has increased 85.94% in the past six months and 25.57% during the previous three months.