Analysts cover DraftKings (NASDAQ:DKNG) are defending the carry today. That’s after it tumbled more than hexad percent lowest hebdomad on a glum third-quarter earnings news report and tepid revenue outlooks for 2021 and 2022.
The online sportsbook operator lost $1.35 a share inward the September canton — considerably infra the red of $1.06 analysts expected. DraftKings also tightened its 2021 teetotum run along forecast to $1.24 one million million to $1.28 one million million from $1.21 one thousand million to $1.29 billion. That weighed on the shares in conclusion Friday. But the shares are higher by 1.64 percent in too soon trading Monday after some analysts defended the downtrodden gaming stock.
We are encouraged with the part gains DKNG achieved in September, coinciding with the slice over to its possess mathematical product tech stack allowing for greater production innovation. DKNG made it crystallize the plan of attack to Entain was opportunistic, and they believe they can achieve their point marketplace share and mathematical product roadmap through SBTech,” said Needham analyst Bernie McTernan inwards a take down to clients today.
He’s referencing DraftKings’ recently scrapped adjure for Entain Plc (OTC:GMVHY), which some marketplace observers believe was motivated by technology, implying the former wooer isn’t proud of(p) with its SBTech platform.
Analysts Still Bullish on DraftKings…Sort Of
For the to the highest degree part, sell-side analysts remain positive on DraftKings, though on that point is at least unity dissenting voice.
At least ane more — Oppenheimer’s Jed Grace Kelly — says the gaming accompany can top off its 2022 revenue forecast, licking analysts’ expectations inwards the process. For 2022, the company is estimating revenue of $1.7 billion to $1.9 billion, representing year-over-year growth of 43 percent. Wall Street is expecting $1.81 billion.
“We are increasing our revenue estimate inwards ’22E by nearly 20 percent to $1.91 1000000000 . This contemplates $1.8 one thousand million of same-state revenue, at the midpoint of the company’s guide positive ~$10 one thousand thousand for new territories including Canada, New House of York and Arizona,” said Kelly.
The Robert Oppenheimer psychoanalyst did, however, trimming his DraftKings damage mark to $70 from $80. Guidance issued by the companionship doesn’t include potential impact from state launches after Nov. 5.
Luck’s Gotta Improve, Focus on US
As pointed out past the fellowship itself, clients’ technique in NFL betting hampered third-quarter results. Translation: The domiciliate doesn’t ever win, and that was evident inwards DraftKings’ Sep billet results.
“A key focus for the billet has been the outstandingly low-pitched throw rate, which mgmt expects to turn back over the normal course of business and to improve further with increased espousal of in-game/micro-wagering and parlays,” said Jefferies psychoanalyst Jacques Louis David Katz.
Katz also notes DraftKings “sufficiently addressed questions” pertaining to the Entain takeover effort, and that the operator is likely to get under one's skin plump for to focusing on its Second Earl of Guilford American ontogeny strategy.
DraftKings dropped its pursuance of Entain on Oct. 26, and if it wants to restart those talks with the former target, it has to hold off hexad months from that date, pursuant to the UK mergers and acquisitions code.