Skip to main content

DraftKings Rises as Cathie Wood, ARK Next Generation Buys in

Online sports gambling specialist DraftKings surged as ARK Next Generation Internet ETF bought 620,300 shares.
  • Author:
  • Publish date:

DraftKings  (DKNG)  shares surged on Tuesday after ARK Next Generation Internet ETF  (ARKW)  disclosed a purchase of 620,300 shares of the sports gambling platform.

ARK Next Generation is run by the prominent fund manager Cathie Wood. As of Feb. 1, the fund owned 620,300 shares of the Boston company, valued at nearly $34 million.

DraftKings recently traded at $59.51, up 8.9%. It has surged 78% over the past six months amid investor excitement for online sports gambling. The stock touched a 52-week high above $64 on Oct. 2.

Ark Next Generation recently traded at $168.01, up 2.1%. It has more than doubled (up 166%) over the past 12 months. Its holdings include Tesla  (TSLA) , Teladoc Health  (TDOC) , Square  (SQ) , Roku  (ROKU)  and Tencent Holdings  (TCEHY) .

As for DraftKings, on Monday Benchmark analyst Mike Hickey affirmed the stock buy and raised his price target to $66 from $60, the Fly and other sites reported.

Scroll to Continue

TheStreet Recommends

And last week Goldman Sachs analyst Stephen Grambling upgraded the stock to buy from neutral, raising his price target to $65 a share from $45.

"We upgrade DKNG based on their sustained market leading position in key states, ability to participate in the economics of single-operator states, and presence of national contracts which will allow them to achieve scale sooner than the broader peer group," the analyst said.

DraftKings, he added, has "ample dry powder to invest in near-term growth, plus optionality to engage with single operator states and leverage key national partnerships."

Grambling said he continued to see DraftKings and Penn National Gaming  (PENN)  as having "the greatest optionality to drive a network effect which we expect to be accompanied by an upward valuation rerating."

Over the next 12 months, Grambling said he expected the two companies to "surface benefits of national brand recognition and scale.”