Needham Pounds the Table on DraftKings Inc. (DKNG) Buy, Raises Estimates
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Needham & Company analyst Brad Erickson reiterated a Buy rating and $70.00 price target on DraftKings Inc. (NASDAQ: DKNG) while raising Revenue for 2021 to $802.5M from $738.2M. While no upcoming catalyst was given and the estimate increases seem to be from the recently released strong earnings report and guidance increase, the analyst believes fear over the upcoming lockup is overdone.
The analyst stated "DKNG’s strong report and raised guidance reinforces our view that concerns and stock weakness due to upcoming lock-up expirations will prove overdone. Growth is incrementally stronger, CAC efficiency is improving, market share commentary was better than expected, and management spoke to market-level profitability visibility that should illuminate in upcoming quarters." He went on to state "We want to own one of the clear leaders in online gambling as new US States unlock. We raise our revenue and EBITDA estimates for '20, ’21, and ’22 and remain Buy-rated."
Shares of DraftKings Inc. closed at $43.22 yesterday.
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