DraftKings Set to Continue Strong Performance, Says Wells Fargo Analyst
A recent report by Wells Fargo suggests that DraftKings, a popular online sports betting company, could see even greater success in 2023. The company’s second-quarter results exceeded expectations, indicating its potential for reaching $1 billion in adjusted EBITDA.
According to analyst Daniel Politzer, DraftKings is gaining market share, improving its product offerings, and effectively managing operating expenses. As a result, Politzer has upgraded the company’s stock rating to “overweight” and raised the price target to $37 from $28, indicating a potential 16.6% increase in stock value.
Despite already experiencing a significant increase of over 179% year-to-date, Politzer believes that DraftKings will continue to achieve positive EBITDA revisions, leading to even greater valuation.
Politzer attributes this growth to various factors, including structural improvements, shorter payback periods, overall industry growth, and consolidation trends. Additionally, upcoming customer acquisition opportunities, such as the NFL kickoff in early September, along with potential expansions in new states due to sports betting legislation, further support DraftKings’ positive outlook.
Shares of DraftKings rose approximately 2% before the market opened on Monday.
Source: AsumeTech’s