DraftDay Fantasy Sports Inc (NASDAQ:DDAY) Attempting To Rebound

Shares of DraftDay Fantasy Sports Inc (NASDAQ:DDAY) have been weak ever since the company received its delisting notice from NASDAQ last month. We at Insider Financial are familiar with DraftDay as it was a big winner for us and our subscribers in February. We caught the explosive move higher. Now, we're asking if DDAY can do it again.DraftDay Fantasy Sports Inc is the largest shareholder of DraftDay Gaming Group, with a 44% stake. Sportech owns 35%. The company hopes that by combining and capitalizing on the well-established operational business assets of DraftDay and Sportech, the new DraftDay is well-positioned to become a significant player in the explosive fantasy sports market. DraftDay has paid out over $30 million in prizes with increased player retention and brand loyalty. DraftDay Fantasy Sports also operates MyGuy and Viggle Football both of which offer real-time interactive participation with professional and college football games; Wetpaint, which offers entertainment and celebrity news; and Choose Digital, a digital marketplace platform that allows companies to incorporate digital content into existing rewards and loyalty programs in support of marketing and sales initiatives.On March 1, DDAY announced that it received a letter from the Listing Qualifications Department of The NASDAQ Stock Market (“NASDAQ”) notifying the Company that NASDAQ had determined the Company is unlikely to achieve near-term compliance with certain listing requirements relating to minimum stockholders’ equity and timely filing of quarterly reports. DDAY said that it intends to appeal this decision by requesting a hearing before a NASDAQ Listing Qualifications Panel to review NASDAQ's decision to delist the Company. A hearing request by the Company automatically postpones the delisting of the Company's securities pending issuance of the Panel's decision.IBISWorld estimates that revenue for the fantasy sports market has grown at an annual rate of 10.8 percent to $2.0 billion from 2010 to 2015. DraftDay will have a differentiated platform in the industry. The company plans to focus on B2B partnerships, including new ventures with companies.The company just closed the sale of a number of assets, including the Viggle applications and rewards program, for stock in Perk.com, a leading cloud-based mobile rewards platform provider based in Austin, Texas. Perk.com trades on the Toronto exchange under the symbol PER.TO. Perk is a mobile-centric rewards platform targeting the “New Consumer” and rewarding people for their everyday mobile and internet activities.Perk.com is paying in $4.7 million worth in shares along with a $1 million advance, subject to some performance conditions; DraftDay will get two warrants to purchase a total 2 million Perk.com shares. DraftDay CEO Robert Sillerman says if earnouts are achieved and warrants become exercisable, DraftDay will have received about $75 million in consideration.We said in our original article that the most controversial aspect to DDAY is Chairman and CEO Robert F.X. Sillerman. He was once on the Forbes 400 after selling SFX Entertainment to Clear Channel in 2000 for $4.4 billion. He refounded SFX Entertainment in 2012 as a promoter of electronic dance music festivals only to see SFX Entertainment fall into bankruptcy earlier this month. Shareholders are very upset with Mr. Sillerman and many blame him for the company’s failure.Currently trading with just an $11 million market cap, DraftDay Fantasy Sports is the third-largest operator in the daily fantasy sports industry and the only publicly traded name in this fast-growing space. With the NFL season around the corner, we believe this will get investors interested in this underfollowed company and cheap way to play on the growth of the fantasy sports business.In regards to Mr. Sillerman, we trust that he’s learned from past mistakes and sees DDAY as an opportunity to vindicate himself with investors. Due to the excitement surrounding fantasy sports, we can easily see DDAY making a strong comeback. We will be updating Insider Financial as soon as we know more. For continuing coverage on DDAY, sign up for our free newsletter today and get our next hot stock pick!Disclosure: We have no position in DDAY and have not been compensated for this article.