Leading online sports betting company DraftKings (NASDAQ:DKNG) reported stellar revenue growth in the second quarter. However, the company is currently facing multiple lawsuits due to alleged violations of federal securities laws. Furthermore, with negative profit margins and a stretched valuation, is the stock worth betting on now? Read more to find out.Online sports and entertainment company DraftKings Inc. (DKNG), which is headquartered in Boston, Mass., reported impressive second-quarter results on August 6. DKNG’s revenues increased 320% year-over-year to $298 million for the quarter ended June 30. This can be attributed to a 281% rise in its monthly unique players for the B2C segment.
Following the earnings release, shares of DKNG gained 2.2% intraday to close Friday’s trading session at $51.59.
However, the company has yet to generate a profit. In its fiscal second quarter its loss from operations and net loss came in at $302.93 million and 305.53 million, respectively. Its adjusted loss before interest, taxes, depreciation, and amortization stood at $95.30 million, up 59.3% from the same period last year. Furthermore, analysts expect DKNG’s EPS to remain negative until at least 2022.