Many analysts have seen to change their stance for DraftKings (DKNG) stock which is more towards the positive side. There are multiple reasons that could be cited to make analysts bullish and bring a shift in suggestion regarding the stock. Most prominent ones are NFT season 2022 data, rising revenue and valuation of the company and its moderated spendings on promotional activities, etc.
Zachry Warring, an analyst at CFRA Research, put “buy” for DKNG stock and a targeted price for the stock of 20 USD. Moreover the analyst is also optimistic for the iGaming market to rise up to 80 billion USD worth valuation. Out of this, about 35% he expected to be dominated by DraftKings.
Meanwhile the targeted price of 20 USD for the stock is clearly over 50% high from its closing price of approx 13.21 USD last week.
Impact of DraftKings’ Popularity on DKNG Stock Price
Analyst Bernie McTernan from Needham also elevated the rating for DKNG stock and rated it with a “buy’’. And he also noted the targeted price for the stock 25 USD. The analyst is bullish for the stock given the company’s strong holds such as one of the highest rated mobile applications and having a viable customer acquisition plan.
McTernan stated DKNG has a sustainable strategy regarding customer acquisition expecting it to continue driving top positions across the states. He further expected scaling in margins following the transition of tech stack from Kambi to SBTech. This would benefitting marketing of national against local and make accessing the penetration to the terminal market.
Legislation in Favor of Sports and Betting Companies
Warring also added to the optimism following a positive push from passing of several legislation making sports betting and mobile gaming legal within specific states. The analysts expect this to make the company witness a jump of 25% in its annual revenue.
Although by now DKNG stock price was experiencing headwinds due to macroeconomic situations all around. This is due to the change in behavior of analysts and investors who became more cautious while choosing a stock. The risk appetite minimized due to losing of interest in making investment in potential money losing projects given the Federal Reserve’s interest rate hikes.
The CFRA analyst put it while comparing the expected 4 times the growth revenue till 2022 to stay only around 3.8 times within the same timeframe. Trading price for this week’s opening also draws a similar picture whereas the DKNG stock price on Monday remains slightly over 13 USD, which is down by more than 51% from the price in its year-to-date frame.
Prominent American daily fantasy sports and betting contest company DraftKings holds an overall valuation of 5.86 billion. Currently DKNG stock is trading at 14.60 USD with a slight jump of over 3.5% from yesterday.
Source: https://www.thecoinrepublic.com/2022/10/27/analysts-reporting-positive-ratings-for-dkng-stock/