• Sun. Sep 19th, 2021

DraftKings Inventory Value Goal Upped, Analyst Sees Firm Taking Share from FanDuel

BySpeed Casino

Sep 15, 2021

Posted on: September 14, 2021, 10:27h. 
Final up to date on: September 14, 2021, 02:36h.

Todd Shriber Learn Extra

DraftKings (NASDAQ:DKNG) inventory is following different gaming equities decrease as we speak. However the sportsbook operator is on the receiving finish of extra assist from the sell-side.

DraftKings inventory highlighted on the Nasdaq market website, seen above. An analyst lifted his worth goal on the title as we speak. (Picture: Through Information Company)

In a observe to shoppers as we speak, Craig-Hallum analyst Ryan Sigdahl reiterates a “purchase” ranking on DraftKings, whereas boosting his worth goal on the inventory to $70 from $60. That suggests upside of virtually 17 p.c from present ranges.
DraftKings’ all-time excessive is $74.38, which was set in late March. The Wall Avenue consensus worth forecast on the title is $70.85.
DraftKings is the one pure-play sports activities betting title at the moment out there within the US fairness market — a trait lengthy highlighted by bullish analysts. The inventory is up almost 30 p.c year-to-date and 10.71 p.c over the previous month, with that current ascent powered largely by the arrival of soccer season.
Soccer Unbelievable Catalyst for DraftKings Inventory
Soccer is probably the most wagered-on sport within the US, and as such, the beginning of the 2021 season is fueling upside for sports activities betting equities.

Sigdahl, the Craig-Hallum analyst, says soccer wagering volumes are already topping “lofty” forecasts. Particular to DraftKings, the analyst sees that operator as best-positioned to learn from soccer betting enthusiasm. He famous the corporate may steal market share from rival FanDuel this season.

FanDuel, a unit of Flutter Leisure, is the most important on-line sportsbook operator within the US, whereas DraftKings is locked in an more and more intense battle for the second spot with BetMGM.
Knowledge confirms that soccer is certainly materials for betting operators. The game drives an estimated 35 p.c to 40 p.c of annual revenues for sportsbooks, with a 3rd of these yearly gross sales arriving within the fourth quarter.
One level analysts and traders will certainly be monitoring when third- and fourth-quarter earnings experiences begin rolling in is how a lot betting corporations are spending on buyer acquisition. It’s a related level, as a result of a few of the marquee names within the on-line wagering house aren’t but worthwhile. That’s necessary for DraftKings traders, as a result of the corporate might not flip worthwhile on the premise of earnings earlier than curiosity, taxes, depreciation and amortization (EBITDA) till 2023 on the earliest.
Loads of Enthusiasm for DraftKings Inventory
Since changing into a standalone public firm in April 2020, DraftKings grew to become a Wall Avenue favourite, a reality that continues to be true as we speak. Twenty-six analysts cowl the corporate, 18 of which have bullish or very bullish rankings on the shares.
The operator is a constant raiser of income steering, and a few analysts are already speculating that with a powerful soccer deal with, DraftKings may elevate third-quarter and full-year gross sales estimates.
A lot of traders’ enthusiasm for DraftKings revolves round growing state-level legalization of web casinos and sports activities betting. Additionally they observe the next income enhance that comes with a extra hospitable income setting. Moreover, the corporate has a powerful stability sheet and is displaying a willingness to make acquisitions to increase its high line profile.

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