Craig-Hallum analyst Ryan Sigdahl is out with a spacious commentary on gaming stocks today, trim price targets on half a dozen names.
While the analyst isn’t overtly bearish on the stocks, he’s paring cost outlooks on half a dozen companies – all of which experience ties to net casinos and online sportsbooks. That aggroup includes DraftKings (NASDAQ:DKNG) and Penn National Gaming (NASDAQ:PENN), ii of finally year’s to the highest degree severely punished gaming stocks.
While maintaining a “buy” rating on DraftKings, Sigdahl slashes his damage target on that inventory to $51 from $70, connection a growing listing of analysts lowering cost forecasts on the online sportsbook operator. On the upside, the psychoanalyst says online sports wagering is a megatrend that’s allay inward its ahead of time innings, and the scarceness of slipway with which to frolic that trend are favorable points for DraftKings.
He believes the operator tin can bolster iGaming securities industry deal and earnings before interest, taxes, depreciation and amortization (EBITDA) in front of its antecedently proclaimed forecast.
Penn Not Fully Appreciated
Of the six companies that are receiving get down terms estimates from Sigdahl, Penn National is the only when ace that runs land-based casinos.
In fact, the companionship is the largest regional casino manipulator in the US. The Craig-Hallum analyst trims his terms forecast on William Penn to $96 from $130, while acknowledging brick and mortar casinos supply warm hard currency stream William Penn canful utilize to fund internet investments, including Barstsool Sportsbook.
While Penn has been synonymous with Jacques Louis David Portnoy’s Barstool Sports for ii years after taking a 36 percent bet in that media prop in Jan 2020, Sigdahl says the spousal relationship of Barstool’s devoted devotee base, favourable demographics, marketing prowess and Penn’s multi-state step “creates an unrivaled omnichannel offering.”
Penn stock up was repudiated last year, and it resides 65.44 percent to a lower place its 52-week high. But some analysts are highlighting it as a 2022 rebound candidate.
Slew of Gaming Tech Stocks Get Trimmed
Sigdahl also takes the ax to his cost targets on sports betting data providers Genius Sports (NYSE:GENI) and Sportradar. He lowers the former to $22 from $27, and the latter to $30 from $35.
He notes both companies go on sporting impressive compound yearly ontogeny rates and stout EBITDA margins. The analyst adds both companies equate favourably with traditional swelled data purveyors, and offer superior margin expansion possible comparative to entrenched companies in the data space.
Speaking of gaming tech names, Sigdahl pares his damage point on GAN (NASDAQ:GAN) to $14 and $18. While he likes near-term trends for the gaming software package provider, he adds GAN could human face militant threats as its posture evolves to include more exposure to business-to-consumer clients.
The other gaming gillyflower Sigdahl lowers his damage gauge on is Rush Street Interactive (NYSE:RSI). The analyst goes to $19 from $22 on that gillyflower piece maintaining a “buy” rating on the iGaming and online sportsbook operator.