DraftKings’ stock has continued its winning streak, closing 2.7% higher on Thursday, following positive views from two analysts. The online-gambling company has seen a surge in its stock price after JMP Securities analyst Jordan Bender expressed optimism about DraftKings’ upcoming June-quarter earnings report. Bender believes that the company’s results will showcase top-line strength, with lower promotional activity potentially boosting the bottom line. Notably, he highlights that DraftKings has exhibited some of the lowest levels of promotions in the industry. He also anticipates that online sports-betting operators will emphasize heightened customer reinvestment, leading to strong retention rates.
Another analyst, Clark Lampen from BTIG, also provided a bullish outlook for DraftKings. Lampen believes that DraftKings’ results could benefit from favorable outcomes in terms of event results. He also notes that DraftKings is benefiting from ongoing shifts in parlay mix and a moderation in competition. As a result, Lampen has raised his price target on DraftKings shares to $34 from $31, maintaining a buy rating.
DraftKings’ stock rally on Thursday follows a 5.3% gain in the previous trading session. The company’s stock has been on an impressive upward trajectory, surging 175% so far in 2023, while the S&P 500 has seen a more modest 17% increase.
In summary, optimism from analysts regarding DraftKings’ upcoming earnings report, coupled with positive industry trends and favorable outcomes, has fueled the recent rally in DraftKings’ stock price. Investors are closely watching for updates on the company’s top-line performance and the potential impact of reduced promotional activity.
