{"id":239160,"date":"2022-10-24T15:01:40","date_gmt":"2022-10-24T20:01:40","guid":{"rendered":"https:\/\/www.casino.org\/news\/?p=239160"},"modified":"2022-10-26T06:02:13","modified_gmt":"2022-10-26T11:02:13","slug":"draftkings-stock-lauded-by-two-analysts-forecasting-big-upside","status":"publish","type":"post","link":"https:\/\/www.casino.org\/news\/draftkings-stock-lauded-by-two-analysts-forecasting-big-upside\/","title":{"rendered":"DraftKings Stock Earns Analyst Support"},"content":{"rendered":"

Wall Street remains divided on DraftKings (NASDAQ: DKNG), but the stock drew support Monday from a pair of analysts.<\/p>\n

\"DraftKings\"
Inside a DraftKings office. The stock earned praise from two analysts on Monday. (Image: Bloomberg)<\/em><\/figcaption><\/figure>\n

Recently, some analysts turned bullish on the beleaguered gaming stock, citing factors such as encouraging hold data to start the 2022 NFL season, valuation, rising same-state revenue, and a more restrained promotional spending environment.<\/p>\n

In a note to clients on Monday, CFRA Research analyst Zachary Warring upgraded DraftKings<\/a> to \u201cbuy\u201d with a $20 price target, implying upside of about 53% from the October 21 close. He estimates the company can eventually command 35% of what could be an $80 billion market for iGaming and sports wagering in North America<\/a>.<\/p>\n

We expect tailwinds to continue as more states pass legislation to legalize sports betting and mobile gaming. As DKNG enters more states they will continue to grow revenues +25% annually while improving margins and leveraging fixed costs,\u201d according to the analyst.<\/strong><\/p><\/blockquote>\n

That $80 billion estimate is one of the more ambitious valuations for the company. But, DraftKings garnering 35% of total addressable markets isn\u2019t unreasonable, given its already solid perches in online sports betting<\/a> and internet casinos.<\/p>\n

Valuation Case for DraftKings Stock<\/h2>\n

Bullish musings aside, there\u2019s no denying that DraftKings stock entered Monday with a year-to-date loss of 51.91% — enough to scare even risk-tolerant investors away.<\/p>\n

\n

The primary reason for that slide is market participants\u2019 distaste for money-losing companies<\/a> against the backdrop of rising interest rates. Rising rates diminish the appeal of growth firms\u2019 future cash flow, and DraftKings is most certainly a growth stock.<\/p>\n<\/div>\n

Still, there\u2019s a valuation case with the downtrodden shares. CFRA\u2019s Warring said that case is intact, with the stock trading below 4x 2022 revenue forecasts. His $20 price forecast implies a 2022 EV\/sales multiple of 3.8x.<\/p>\n

After a dismal 2021 and mostly forgettable run in 2022, publicly traded sportsbook operators such as DraftKings \u2014 and casino companies with direct exposure to the business \u2014 are under scrutiny from analysts and investors<\/a> regarding promotional spending. There\u2019s some evidence operators are keeping a lid on that spending this football season.<\/strong><\/p>\n

Some analysts see signs of promotion rationalization from DraftKings. That’s as the gaming company is under pressure to stem losses and show investors that there\u2019s a viable path to profitability sooner than later.<\/p>\n

Speaking of Football’s Impact \u2026<\/h2>\n

In the firm\u2019s weekly update on the NFL\u2019s impact on sportsbook operators, Needham analyst Bernie McTernan noted week seven results appear promising for gaming companies. He rates DraftKings stock a \u201cbuy\u201d with a $25 price target.<\/p>\n

He also highlighted DraftKings as having one of the highest-rated mobile apps next to rival FanDuel and a viable customer acquisition plan.<\/strong><\/p>\n

\u201cWe believe DKNG has a sustainable customer acquisition strategy that should continue to drive its first- or second-place position in all states. We expect margins to scale with the tech stack transition to SBTech from Kambi, benefits of national vs local marketing and reaching terminal market access penetration,\u201d wrote McTernan.<\/p>\n","protected":false},"excerpt":{"rendered":"

Wall Street remains divided on DraftKings (NASDAQ: DKNG), but the stock drew support Monday from a pair of analysts. Recently, some analysts turned bullish on the beleaguered gaming stock, citing factors such as encouraging hold data to start the 2022 NFL season, valuation, rising same-state revenue, and a more restrained promotional spending environment. In a […]<\/p>\n","protected":false},"author":46,"featured_media":239161,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[10,1074],"tags":[81903,80968],"acf":[],"yoast_head":"\nDraftKings Stock Lauded By Two Analysts Forecasting Big Upside<\/title>\n<meta name=\"description\" content=\"DraftKings stock wins praise from two analysts that believe it can deliver big gains for investors.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.casino.org\/news\/draftkings-stock-lauded-by-two-analysts-forecasting-big-upside\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"DraftKings Stock Lauded By Two Analysts Forecasting Big Upside\" \/>\n<meta property=\"og:description\" content=\"DraftKings stock wins praise from two analysts that believe it can deliver big gains for investors.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.casino.org\/news\/draftkings-stock-lauded-by-two-analysts-forecasting-big-upside\/\" \/>\n<meta property=\"og:site_name\" content=\"Casino.org\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/Casino.OrgNews\" \/>\n<meta property=\"article:published_time\" content=\"2022-10-24T20:01:40+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2022-10-26T11:02:13+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2022\/10\/DKNG-1.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1200\" \/>\n\t<meta property=\"og:image:height\" content=\"701\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Todd Shriber\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@etfgodfather\" \/>\n<meta name=\"twitter:site\" content=\"@Casino_Org\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Todd Shriber\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"3 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.casino.org\/news\/draftkings-stock-lauded-by-two-analysts-forecasting-big-upside\/\",\"url\":\"https:\/\/www.casino.org\/news\/draftkings-stock-lauded-by-two-analysts-forecasting-big-upside\/\",\"name\":\"DraftKings Stock Lauded By Two Analysts Forecasting Big Upside\",\"isPartOf\":{\"@id\":\"https:\/\/www.casino.org\/news\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/www.casino.org\/news\/draftkings-stock-lauded-by-two-analysts-forecasting-big-upside\/#primaryimage\"},\"image\":{\"@id\":\"https:\/\/www.casino.org\/news\/draftkings-stock-lauded-by-two-analysts-forecasting-big-upside\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2022\/10\/DKNG-1.jpg\",\"datePublished\":\"2022-10-24T20:01:40+00:00\",\"dateModified\":\"2022-10-26T11:02:13+00:00\",\"author\":{\"@id\":\"https:\/\/www.casino.org\/news\/#\/schema\/person\/f4cecf70a5032bc4e60eb73fc86d4a85\"},\"description\":\"DraftKings stock wins praise from two analysts that believe it can deliver big gains for investors.\",\"breadcrumb\":{\"@id\":\"https:\/\/www.casino.org\/news\/draftkings-stock-lauded-by-two-analysts-forecasting-big-upside\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/www.casino.org\/news\/draftkings-stock-lauded-by-two-analysts-forecasting-big-upside\/\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/www.casino.org\/news\/draftkings-stock-lauded-by-two-analysts-forecasting-big-upside\/#primaryimage\",\"url\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2022\/10\/DKNG-1.jpg\",\"contentUrl\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2022\/10\/DKNG-1.jpg\",\"width\":1200,\"height\":701,\"caption\":\"A picture shot inside a DraftKings office. 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