DraftKings Is On A 'Quicker And More Visible Path To Profitability,' Says Bullish Analyst

In an exclusive interview with Benzinga, DraftKings Inc DKNG CEO Jason Robins shared his thoughts about what is in store for the sports betting company.

Given the inflection to profitability in the second quarter, it appears that the company’s “training wheels are off,” according to Truist Securities.

The DraftKings Analyst: Barry Jonas upgraded the rating for DraftKings from Hold to Buy, while raising the price target from $31 to $44.

The DraftKings Thesis: The second-quarter results were significantly better than the consensus estimates, and DraftKings now seems to be on “a quicker and more visible path to profitability,” Jonas said in the upgrade note.

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The company is poised to benefit from “a more rational promo and marketing environment coming sooner than we initially expected,” the analyst wrote. DraftKings could continue to gain market share and close the gap with FanDuel, he added.

“With the darkest, deepest-investment days in the rearview, we think DKNG is primed to generate meaningful EBITDA in ($385M/$944M for 2024E/2025E vs. Street’s $228M/$707M) and beyond,” Jonas further stated.

DKNG Price Action: Shares of DraftKings had risen by 2.09% to $32.29 at the time of publication Tuesday.

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