DraftKings price target raised to $45 from $40 at Craig-Hallum

Craig-Hallum raised the firm’s price target on DraftKings to $45 from $40 and keeps a Buy rating on the shares following the company’s analyst event. DraftKings’ dominance of online gambling in North American is clear and sustainable with strong operating leverage over the coming years, the firm argues. Assuming no incremental state legislation, management now expects $2.1B of EBITDA in 2028 vs previously viewing that as its long-term target. The path from an adjusted EBITDA loss in 2023 to $400M in 2024, nearly $1B in 2025E, $1.4B in 2026, and $2.1B in 2028 shouldn’t be viewed as aspirational, Craig-Hallum says, but instead likely given a byproduct of the cohort builds, accelerating product innovation, and industry-leading retention, all while reducing promotional and marketing intensity. DraftKings remains a must-own growth stock with strong industry and business tailwinds, adds the firm.