Morgan Stanley Expects Interest Rate Trends to Shift Spending Away from Services Toward Goods

DraftKings Inc. (NASDAQ:DKNG) is one of the best US stocks to buy and hold in 2026. On January 16, Morgan Stanley raised its price target on DraftKings to $53 from $50 with an Overweight rating. In a 2026 outlook report, the firm noted that the gaming, lodging, and leisure sectors saw sluggish growth throughout 2025. The few bright spots were concentrated among businesses catering to an older demographic. For 2026, Morgan Stanley anticipates similar fundamental performance, though the firm expects rising interest rates to shift consumer spending away from services and toward goods.

On January 14, Wells Fargo upgraded DraftKings Inc. (NASDAQ:DKNG) from Equal Weight to Overweight, raising the price target from $31 to $49 as part of a 2026 digital gaming industry outlook. The firm remains optimistic about the sector’s long-term growth and projects substantial profit increases for 2026; however, Wells Fargo particularly highlighted DraftKings for its superior near-term potential.

Morgan Stanley Expects Interest Rate Trends to Shift Spending Away from Services Toward Goods

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A day before the Wells Fargo rating, Truist increased its price target for DraftKings from $43 to $45 while maintaining a Buy rating in a 2026 preview of the US Gaming sector. The adjustment comes after a volatile 2025, where macroeconomic concerns and fears surrounding prediction market disruption weighed on gaming stocks despite their steady underlying fundamentals. For 2026, the firm expects land-based gaming to remain stable, though a full recovery in the Las Vegas market remains uncertain.

DraftKings Inc. (NASDAQ:DKNG) operates as a digital sports entertainment and gaming company in the US and internationally. It also offers DraftKings marketplace, a digital collectibles ecosystem designed for mainstream accessibility that offers curated NFTs on the marketplace.

While we acknowledge the potential of DKNG to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than DKNG and that has 100x upside potential, check out our report about this cheapest AI stock.

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Disclosure: None. This article is originally published at Insider Monkey.