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Investing.com - Goldman Sachs raised its price target on DraftKings Inc. (NASDAQ:DKNG) to $61.00 from $59.00 while maintaining a Buy rating following the company’s second-quarter 2025 earnings report. The stock has shown impressive momentum with a 48% return over the past year, while InvestingPro data indicates the company currently trades near its Fair Value.
The firm noted that DraftKings delivered Q2 revenue and adjusted EBITDA results that exceeded both Goldman Sachs estimates and company guidance, attributing the performance to more favorable sports outcomes and core value drivers.
DraftKings management reiterated its full-year 2025 revenue and adjusted EBITDA guidance, which Goldman Sachs interpreted as a signal of confidence in positive underlying fundamentals.
The investment bank highlighted several positive trends, including a 100 basis point year-over-year increase in structural hold, a 430 basis point year-over-year increase in parlay handle mix, and a 600 basis point year-over-year improvement in promotional reinvestment as a percentage of gross gaming revenue.
Goldman Sachs also noted that DraftKings repurchased approximately $100 million worth of stock during the quarter, with about $700 million remaining in its buyback program, as the company’s free cash flow continues to improve.
In other recent news, DraftKings Inc. reported its second-quarter 2025 earnings, significantly surpassing expectations. The company achieved an earnings per share of $0.38, far exceeding the forecasted $0.13, which represents a surprise of 192.31%. Revenue for the quarter reached $1.51 billion, surpassing the anticipated $1.4 billion. Despite these impressive results, DraftKings reiterated its full-year 2025 guidance, noting factors such as launch costs in Missouri and tax increases in states like Illinois, Louisiana, and New Jersey. Stifel maintained its Buy rating for DraftKings with a price target of $51.00, acknowledging the company’s strong performance despite tax and regulatory challenges. Stifel attributed the positive EBITDA results to favorable sporting outcomes and improvements in the core business. These developments highlight DraftKings’ ability to navigate emerging challenges while delivering strong financial performance.
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