DraftKings (NASDAQ: DKNG) extended its July mass meeting Midweek on the rearwards of bullish comments from Bank of America analyst Shaun Kelley.

In midday trading, the carry is higher past 5.32% on intensity that’s already exceeded the day-after-day average. That extends its gains over the past week to 16.56%, and its upsurge over the past tense month to nearly 22%. In a short letter to clients, Kelley upgraded DraftKings to “buy” from “hold” while boosting his price place on the shares to $35 from $25. That implies upside of 18.6% from the July 11 close.

While DKNG has outperformed in 2023, we believe market deal gains tin can ride both Q2 ’23 and near-term top off line of merchandise revisions (though likely anticipated) patch be leverage will potential parkway larger revisions in adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) and margins than anticipated,” wrote Kelley.

DraftKings is higher by 167% year-to-date. It’s a upsurge Kelley said is fueled inward piece past a to a greater extent rapid step of sports betting launches in the states approving the activity and the operator generating an progressively larger sports wagering hold.

Good Time for DraftKings Stock Rally

There’s ne'er a spoilt time for a gunstock to rally. But inwards the typesetter's case of DraftKings, the recent run to the upside is peculiarly well-timed, because the Boston-based troupe is expected to deliver second-quarter results on Aug 4.

DraftKings soaring into its earnings could follow a positive sign, particularly for a gillyflower with a cart track enter of making large moves followers financial updates. On a related to note, the last 20 earnings per share (EPS) revisions on the stock up past analysts have been of the bullish variety. Kelley points to the operator’s ability to meliorate care costs, such as marketing and promotional spending, as a accelerator for the shares.

“DraftKings has also reached a paint be flexion inwards its immature business organisation model, as we trust the value of ontogeny inwards be of revenue and outside marketing have got peaked,” added the analyst.

Kelley is also bullish on the growing flight of the online sports betting securities industry inward the US, noting it testament acquire 35% on a year-over-year groundwork in 2023. That’s piece posting a compound yearbook growing charge per unit of 15% from this twelvemonth through 2027.

Wall Street Increasingly Bullish on DraftKings Stock

Kelley’s account adds to a spate of latterly positive degree Wall Street commentary on DraftKings stock. Currently, 33 analysts plow the name, with 18 rating it the tantamount(p) of “buy” or “strong buy.” The norm price target is $28.74, which is infra where the gillyflower trades today, indicating there’s elbow room for upside revisions to that number.

Speaking of upside potential, Robert Oppenheimer bumped its cost forecast on the gaming equity to $36 from $30 lastly week, piece BTIG Research anointed DraftKings a pinch pick for the endorse half of 2023.

“DraftKings is expected to benefit from favourable fundamental principle inwards 2023, including production improvements, an increasing parlay mix, a positive degree operating backdrop, and improved efficiency, which could take significant upside in estimates and prescribed revisions,” according to BTIG.