Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

Roth Capital Upgrades DraftKings to Buy Ahead of NFL Season

Published 17/08/2022, 18:30
Updated 17/08/2022, 18:30

By Michael Elkins

Roth Capital Partners decided to upgrade American sports betting company, DraftKings Inc. (NASDAQ:DKNG) to Buy and increased the price target by $7 to $25 ahead of the 2022 NFL season.

A Roth analyst sees ownership of the stock ahead of the season as “a tactical opportunity.” While histories are short, OSB/iGaming stocks have seasonally outperformed between midsummer and the start of NFL season as investors buy into a revenue ramp.

The analyst also believes investors are buying into the narrative of OSB profitability, after 2Q commentary from FanDuel/PENN/CZR. During 2Q results, FanDuel, Caesars (NASDAQ:CZR) and Penn (NASDAQ:PENN) each demonstrated accelerated paths to profitability, with FanDuel generating $22M segment EBITDA in 2Q, Caesars Interactive approaching break-even in July and Penn Interactive expecting profitability in 4Q22.

For DKNG, 2022 guidance implies 2H22 revenue +82% YoY vs 1H22's +45%. Meanwhile, unfavorable hold rates in 2H21 offer easier comps and could help accelerate growth further.

DKNG was down nearly 1.5% in mid-day trading Wednesday.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.