Guggenheim Starts DraftKings Inc. (DKNG) at Buy; Sees $76bn+ North American TAM

April 30, 2021 6:20 AM EDT
Get Alerts DKNG Hot Sheet
Price: $40.99 -2.66%

Rating Summary:
    21 Buy, 7 Hold, 0 Sell

Rating Trend: = Flat

Today's Overall Ratings:
    Up: 26 | Down: 9 | New: 37
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(Updated - April 30, 2021 6:22 AM EDT)

Guggenheim analyst Curry Baker initiates coverage on DraftKings Inc. (NASDAQ: DKNG) with a Buy rating and a price target of $75.00.

The analyst commented, "We are initiating coverage of DraftKings with a BUY rating and $75 price target. Our PT is based off a blended DCF ($80 using 8.3% WACC, 4.0% L-T growth rate) and forward Price to Sales multiple ($70 using a 27.5x 2021 sales multiple). We believe DraftKings is well positioned to capture a significant share of the rapidly growing North American Online Sports Betting (OSB) and iGaming markets. Our analysis points to a L-T NA revenue opportunity (OSB, iGaming) of $7.6-10.6bn (at EBITDA margins in excess of 30%). Beyond the momentum towards legalization and the inherent tailwinds new states/markets offer, we see several other competitive advantages underpinning our positive outlook for DraftKings: a premier sports gaming brand, a market leading position in OSB and iGaming already, a flexible proprietary technology platform that is scalable and vertically-integrated, and plenty of financial firepower to fund future growth."

For an analyst ratings summary and ratings history on DraftKings Inc. click here. For more ratings news on DraftKings Inc. click here.

Shares of DraftKings Inc. closed at $56.52 yesterday.



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