DraftKings Soars Amid Hope Morgan Stanley Upgrade Marks Bottom

DraftKings (NASDAQ:DKNG) ranks as 1 of Wednesday’s best-performing gaming equities. It roseate on hopes that an rising slope from Morgan Henry M. Stanley psychoanalyst Lowell Jackson Thomas Allen Stewart Konigsberg marks an remnant to a long-running slide for the online sportsbook operator.

In a line to clients today, Allen Stewart Konigsberg boosts his DraftKings rating to “overweight” from “equal weight” patch maintaining a $31 cost target area on the stock. That implies upside of 60 percent from the Jan. 25 close.

On the rearward of Allen’s call, DraftKings is higher past almost 12 percent inwards midday trading on volume that’s more than triple the day-by-day average. That puts the carry on stride for its topper intraday performance since Sep 2020.

While acknowledging DraftKings still isn’t profitable, Allen Stewart Konigsberg points to New House of York as evidence there’s still something to the sports betting investiture story.

[New York] results on Fri remind us that the US sports betting/iGaming securities industry is potential to be really large, with only if a smattering of market place portion winners. We await DKNG to be unity of them, and with sentiment at an all-time low on near-term loss concerns, we assure at present as a good clip to enthrone for the long term,” Woody Allen said in the note.

DraftKings got another heave with the genus Arizona Department of Gaming reporting Nov sports betting statistics. The manipulator has a 31.9 percent part of that fast-growing market, putting it out front of all its rivals.

For DraftKings, It’s a Start

Allen’s commentary on DraftKings potential comes as a succor to beleaguered investors inwards the slumping stock.

Entering today, the shares were already downwards 29.67 percent year-to-date, and almost 72 percent to a lower place the 52-week high. Prior to the Daniel Morgan Henry M. Stanley send for on the stock, psychoanalyst sentiment on DraftKings to start 2022 was mostly dour. That’s with the shares faltering amid analyst damage point cuts and as investors grow increasingly itchy near the timeline to profitability.

Investors also uttered occupy virtually the wide landscape of sportsbook operators inward the US and the resources required to get under one's skin forrader in that field. For its part, DraftKings is a prominent disburser on promotions to lure new clients. However, Grace Ethel Cecile Rosalie Allen notes the competitory scene of action already shows signs of thinning, and that’s to DraftKings’ benefit.

“Currently inwards every land that releases securities industry portion out data, the top of the inning 5 operators have got at to the lowest degree 82 percent combined share. Though thither is a lot disconfirming written about the levels of marketing and promotional spending, this has goaded a really concentrated market that only if players of weighing machine canful really compete in,” notes Allen.

Don’t Ignore DraftKings

Profitability remains a undercoat investor concern. But amid the aforementioned slide, DraftKings stock may live residing at levels that are too compelling to ignore.

While we and the market hold been focused on near to medium-term profit concerns, we trust at the electric current price, unity should non snub that DKNG is a leading securities industry divvy up player inward what testament follow a really large, profitable market,” Allen added.

If the stock put up establish on today’s momentum, it’s possible unforesightful sellers that beat-up the caudex last twelvemonth could be forced to compensate section of their positions, potentially fanning the flames of a rally.