Shalom Meckenzie Sold $34M Worth of DraftKings Stock Day Before Hindenburg Report Released

DraftKings (NASDAQ:DKNG) get on fellow member Shalom Meckenzie divested $34 1000000 worth of the sportsbook operator’s shares on June 14. That’s just a mean solar day before Paul von Hindenburg Research revealed a myopic office in the gaming stock up piece publishing a bearish study blasting the company.

On June 14, Meckenzie sold 660,000 shares of DraftKings at an fair toll of $51.56 for proceeds of $34.02 million, according to Insider Arbitrage data.

The next day, the shares tumbled after Hindenburg published a lengthy report. The firm alleges SBTech operates inward countries where sports betting isn’t permitted, and that the Israeli betting engineering truehearted may have ties to unionized crime. SBTech was founded by Meckenzie and is at present a unit of DraftKings.

There doesn’t seem to follow connections betwixt Meckenzie’s to the highest degree recent sales agreement and the Paul Ludwig von Beneckendorff und von Hindenburg report. The Israeli billionaire is the largest possessor of DraftKings plebeian stock. He’s coming into the stake and his table seat past way of life of SBTech participating inward a transaction in which DraftKings merged with a special intent acquisition fellowship (SPAC), which go under the stage for it to become a in public traded entity.

Meckenzie Devoted Seller of DraftKings Stock

As Hindenburg notes inwards its report, Meckenzie’s been an zealous trafficker of DraftKings stock for some time. From June 2020 through and through the 24-hour interval the search firm’s take note was published, insiders at the gaming society sold $1.4 one million million worth of shares.  The SBTech founding father accounted for over a thirdly of that tally at $567.81 million.

Meckenzie’s sales of DraftKings equity surpassed the next ii biggest sellers — directors King John Salter and Steven Murray River — on a combined basis. Hindenburg overtly states it’s likely Meckenzie will follow marketing to a greater extent of the stock.

Several weeks ago, Meckenzie transferred 19 one thousand thousand shares to a bank for his partner and kids, pavage the way of life for them to incline of ~$1 one million million inwards stock up without the same reporting requirements he would follow dependent to,” according to the explore firm.

Prior to his most recent sale, Meckenzie divested 6.94 trillion DraftKings shares lowest October and 4.63 billion shares on June 23, 2020. As of June 14, 2021, he noneffervescent owns 21.52 one thousand thousand shares, according to Insider Arbitrage.

Interesting Timing

Across all industries, it’s vernacular for accompany insiders, including table members, to buy and sell shares of the firm’s equity. It’s also an activity Wall Street and investors pay off attending to.

Conventional wisdom holds that’s usually confirming when a high-ranking executive director or theatre director buys the stock. That belief is rooted inwards the theory that the purchaser is only if buying for ane reason: Because he or she thinks the shares will appreciate.

Conversely, it’s non ever a negatively charged when an insider sells. Those sales may occur simply because the insider needs some hard currency or wants to branch out his or her personal portfolio.

All that said, the optics of Meckenzie’s latest cut-rate sale of DraftKings caudex aren’t great, as the transaction occurred a twenty-four hour period before the release of the Paul Ludwig von Beneckendorff und von Hindenburg written report and with the shares scuffling. The stockpile throw a tertiary of its value over the past times 90 days.