Steven Sheeckutz, an analyst from Citi, maintained the Buy rating on DraftKings (DKNG – Research Report). The associated price target remains the same with $55.00.
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Steven Sheeckutz has given his Buy rating due to a combination of factors including DraftKings’ strategic response to the recent tax increase in Illinois. By implementing a 50-cent transaction fee on all mobile and online bets in the state, DraftKings aims to mitigate the financial impact of the new tax policy, which imposes a $0.25 per wager tax on the first 20 million wagers and $0.50 thereafter.
With both DraftKings and its competitor FanDuel adopting similar transaction fees, Sheeckutz anticipates that DraftKings will successfully offset a significant portion of the tax-related challenges. Despite a potential short-term headwind due to the timing of the fee implementation, the analyst expects DraftKings to maintain a strong market position in Illinois, which represents a substantial share of the state’s betting handle. This strategic move, combined with the expected share price return of 44.8%, supports the Buy rating.
In another report released on June 5, Citizens JMP also maintained a Buy rating on the stock with a $50.00 price target.
DKNG’s price has also changed slightly for the past six months – from $41.470 to $37.980, which is a -8.42% drop .