Shares of DraftKings (NASDAQ:DKNG) slid as much as 11.4% in morning trading Monday as the Dow Jones Industrial Average dove over 800 points, or about 3%, at the open.
Shares of the sports-betting shop have quintupled since the company's initial public offering late last year, and recently hit an all-time high of $55.70 as the return of sports from the pandemic closures had people itching to wager on team sports. New Jersey reported the biggest August haul of any state ever for sports betting.
Having come so far, so fast, it's not surprising DraftKings' stock is tumbling on market weakness. Many investors are probably banking profits they made, which accounts for it falling more sharply than the indexes.
Yet the future still holds a lot of potential. Pennsylvania reported its largest sports-betting take since it legalized wagering on events, and DraftKings also recently signed on to become the exclusive sports-betting platform of football's New York Giants. It's been the proximity to the storied New York sports franchises that has helped make New Jersey the sports-betting capital of the country.