Online gambling and sports betting is such a huge opportunity that most of Wall Street is missing the significance, according to one analyst who initiated DraftKings (NASDAQ:DKNG) coverage at a buy and set a $100 per share price target on Tuesday.
That’s more than double where the sports betting leader is currently valued and factors in the online sports betting and gambling market being at least 50% greater than what analysts are modeling.
Loop Capital analyst Daniel Adam told investors in a research note that DraftKings is worth every bit of the C-note he’s pegged the stock at because the “true total addressable market” of internet-based sports wagering and gaming is over $30 billion, “significantly greater” than the $20 billion other analysts are factoring into their assessments.
Moreover, he expects DraftKings to become the “undisputed share leader and biggest beneficiary” of the “rapidly growing” online gambling market.
The potential is there. DraftKings and rival FanDuel are the leaders in New Jersey, which has become far and away the biggest online sports betting and gaming market, taking in more than $800 million in just sports wagers in October.
Pennsylvania also just reported a huge sports betting haul for the month, over $500 million, with 90% of it coming online, and both DraftKings and Penn National Gaming leading the way.
Twenty-one states currently allow online sports betting, and three more states — Maryland, Louisiana, and South