DraftKings, Penn Earn Cautious, But Optimistic Analyst Commentary

In recent weeks, DraftKings (NASDAQ:PENN) and William Penn National Gaming (NASDAQ:PENN) are among the to the highest degree repudiated sports betting equities. But at least unity analyst is cautiously optimistic on the pair.

CBRE analyst John Lackland DeCree is resuming reporting of a slew of gaming stocks, including DraftKings and William Penn National. He rates both “hold,” but he’s bullish on the long-term prospects for the internet cassino and online sports wagering industries.

DeCree has a $36 cost point on DraftKings, implying upside of 15.1 percent from the Dec. 7 close. His terms acoustic projection on Penn is $60, which is 17.6 percent above where the carry shut on Tuesday. The analyst is more constructive on gambling casino operators with exposure to digital gaming, but he favors those with Las Vegas exposure. While it’s the largest regional casino manipulator inwards the US, Penn doesn’t make a Strip venue, and DraftKings doesn’t control any land-based gaming venues.

DeCree’s calls on DraftKings and Penn go far during a lengthy full stop of weakness for the erst high-flying duo. The online sportsbook whale is cut down 55.38 percent from its 52-week high, spell the Hollywood casino operator resides 63 percent to a lower place that level.

Penn Problems Could Abate

The CBRE analyst acknowledges recent tilt surrounding Barstool Sports beginner David Portnoy may be temporarily keeping institutional investors out from William Penn stock.

Last month, a lengthy exhibit published in Insider revealed tawdry inside information of Portnoy’s dalliances with multiple women, leading to a monolithic intraday tumble for the stock. Portnoy is non beingness supercharged with any crimes because the encounters were consensual, and he maintains the Insider article is no more than a hit piece.

The prevailing consensus inwards the analyst community in the wake of the exhibit is a conservative whole step on Penn stock while acknowledging the state of affairs is a distraction. That seems to line up with DeCree’s mentation on the shares, as he says he’s ready and waiting(p) for “inflection points” to knock DraftKings and Penn to “buy” ratings.

Penn National owns 36 percent of Barstool Sports and has rights to eventually gain Portnoy’s company outright.

Long-Term View on DraftKings

Regarding DraftKings, the CBRE psychoanalyst says the company continues to execute well. But well-heeled rivalry is an issue. Translation: Rivals ilk BetMGM and Caesars Entertainment (NASDAQ:CZR) hold the resources to gambol the long mettlesome in sports betting, and get other businesses to offset printing any weakness encountered inward the digital space.

DraftKings is drawing off criticism from at to the lowest degree one well-known investor, who sees an extended timeline to profitability and says the fellowship is overvalued.

For his part, DeCree is optimistic well-nigh DraftKings’ long-term prospects. But his $36 cost target area on the gunstock is intimately beneath consensus.

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