DraftKings (DKNG – Research Report), the Consumer Cyclical sector company, was revisited by a Wall Street analyst today. Analyst Mike Hickey from Benchmark Co. reiterated a Buy rating on the stock and has a $51.00 price target.
Mike Hickey has given his Buy rating due to a combination of factors that highlight DraftKings’ potential for long-term growth. Despite a temporary setback caused by a weak hold during March Madness, Hickey believes that the market has already accounted for this, and the company’s fundamentals remain strong. DraftKings is showing robust customer acquisition and expanding product capabilities, which are expected to drive future growth. Additionally, the company’s $1 billion buyback program indicates management’s confidence in its long-term prospects.
Hickey also notes that the NCAA Tournament demonstrated strong betting activity, reinforcing DraftKings’ position in the sports betting market. Although the predictable outcomes during the tournament led to a decline in hold, the overall engagement trends remain positive. The company’s performance during the Super Bowl and NFL postseason further supports its growth trajectory. With these factors in mind, Hickey maintains a $51 price target, supported by an estimated fiscal 2025 AEBITDA of $891 million and a 30x multiple.
In another report released yesterday, CFRA also upgraded the stock to a Buy with a $52.00 price target.