UPDATE: DraftKings Inc. (DKNG) PT Raised to $60 at Morgan Stanley as iGaming Strength Beats Expectations
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Morgan Stanley analyst Thomas Allen raised the price target on DraftKings Inc. (NASDAQ: DKNG) to $60.00 (from $58.00) after US sports betting & iGaming market revenue came in ~43% ahead of the analyst's expectations for 2Q.
The analyst reiterated an Overweight rating, stating "following 2Q data, we are increasing our forecasts for the year from $6B to $7B, with $3.8B from sports betting and $3.2B from iGaming. The iGaming forecast assumes stay-at-home tailwinds dissipate, but given the early stages of the market, industry growth could more than offset. Our sports betting forecast assumes CT, MD, and SD launch by YE, but only contribute ~$30m of revenue as SD will be purely retail and we expect only retail will be ready in MD before YE. Our longer-term estimates go up slightly
(e.g. 2022 $8.5B vs. prior $8.3B, 2025 $16.0B vs. prior $15.6B) as higher spend / capita is offset by a slightly slower legalization path, primarily in iGaming."
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