Investing.com -- CFRA downgraded DraftKings Inc (NASDAQ:DKNG) to "Sell" from "Hold" due to valuation concerns despite the sports betting company's strong growth trajectory.
“DKNG continues to lead in innovation and we believe it has the best platform, which should lead to market share gains. We cut our opinion based on valuation as shares trade near 4x 2025 revenue and 25x EBITDA estimates,” analyst said.
The firm noted that while DraftKings has continued to expand its market share and improve profitability, the stock’s current valuation appears stretched relative to its earnings potential. CFRA also flagged risks tied to regulatory changes and increasing competition in the online gambling space.
DraftKings’ stock has surged in recent months, with CFRA cautioning that further upside may be limited.
This content was originally published on Investing.com