Oppenheimer’s Favorite Stocks For Next 12 Months: Top 32 Stock Picks

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8. DraftKings Inc. (NASDAQ:DKNG)

Share Price Upside: 34%

Number of Hedge Fund Investors In Q2 2024: 56

Average Analyst Share Price Target: $48.86

DraftKings Inc. (NASDAQ:DKNG) is an online sports betting company in America that is one of the earliest movers in the highly growing industry. This has allowed it to hold a dominant place in the multi billion dollar market, as DraftKings Inc. (NASDAQ:DKNG) is the second biggest online betting company in America as per EKG, which estimates that the firm’s market share sits at 32%. DraftKings Inc. (NASDAQ:DKNG)’s larger rival in the market is Flutter Entertainment backed FanDuel, which commands a 35% market share. This means that when it comes to cost control, feature addition, player addition, revenue per player, and other key metrics, DraftKings Inc. (NASDAQ:DKNG) has to primarily compete with its larger rival while keeping an eye out for new upstarts with unique features. Additionally, estimates suggest that DraftKings Inc. (NASDAQ:DKNG) can grow its revenue by 21% in 2025 for a sizeable lead over FanDuel’s 12% expected growth. Oppenheimer believes that DraftKings Inc. (NASDAQ:DKNG)’s “competencies in product development and customer acquisition that DKNG utilized to become the daily fantasy sports (DFS) market leader will allow the company to be a critical player in accelerating the shift in U.S. sports betting from ~$150B wagered illegally/offshore to licensed domestic operators.”

Baron Funds mentioned DraftKings Inc. (NASDAQ:DKNG) in its Q1 2024 investor letter. Here is what the firm said:

“Shares of DraftKings Inc., a leading online sportsbook in the U.S., rose during the quarter following an earnings release that showed strong market share gains and an improved outlook for future profitability. Market share capture has been driven by investment in innovative product offerings that are resulting in strong customer retention. The company also announced the acquisition of JackPocket, a digital lottery courier service. We believe the acquisition will help DraftKings achieve a first-mover advantage in many states that offer the JackPocket service but have not yet legalized online sports betting and casino gaming. DraftKings is well positioned to expand margins and generate positive free cash flow as it grows revenues alongside the rapidly expanding U.S. sports betting market, in our view.”

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