DraftKings (DKNG – Research Report), the Consumer Cyclical sector company, was revisited by a Wall Street analyst today. Analyst Bernie McTernan from Needham maintained a Buy rating on the stock and has a $60.00 price target.
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Bernie McTernan’s rating is based on a combination of factors that highlight the strategic moves and promotional activities of DraftKings. Despite the adjustment in the fourth-quarter estimates due to known customer-friendly sports outcomes, the emphasis on promotional strategies like jackpot promotions and ‘happy hour’ offerings indicates an active approach to maintaining user engagement, especially around the Super Bowl.
Additionally, the betting patterns such as the high handle on the ‘over’ bets signify a robust customer interest, which could translate into significant revenue generation. Furthermore, the absence of proposed tax hikes on online sports betting in Michigan and Connecticut is seen as a positive regulatory environment for DraftKings. These elements combined reinforce confidence in the company’s growth prospects, justifying the Buy rating.
In another report released yesterday, BMO Capital also reiterated a Buy rating on the stock with a $52.00 price target.
Based on the recent corporate insider activity of 147 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of DKNG in relation to earlier this year.