Wall Street Bets is a roundup of recent notes from analysts covering the gambling industry.
DraftKings’ fourth-quarter results draw scrutiny
Barry Jonas of Truist Securities looked at Draft Kings’ fourth-quarter results on February 13:
“Following last night’s release (Q4 beat but soft guide), DraftKing’s call today confirmed its underwhelming guidance was meant to be aggressively conservative to hopefully drive a beat and raise cycle this year. We see today’s sell-off as a confluence of the self-imposed ‘conservative’ guidance, prediction market uncertainty (despite the company leaning in) and fears of higher state taxes. We move our 2026E EBITDA down -4% to the high end of guidance, awaiting the 3/2 analyst day for further changes. We move our price target to $33 (from $45) on lower multiples/market re-rating. Maintain Buy rating.”
Jefferies’ David Katz on February 14 also examined DraftKings:
“The decline in estimates and the shares (-53% LTM) should be at an end and we reiterate DraftKings at Buy,” Katz wrote. “The ‘can’t stop ’em, so beat ’em’ strategy for prediction markets is most likely correct, although our focus is on the conservatism in guidance, which bears the brunt cost of predictions launch without any revenue, ESPN Bet development and the launch of new states. Demand for U.S. sports wagering is not decelerating, but evolving, and DraftKings should remain a leader.”
Wynn Resorts’ fourth-quarter results
David Bain of Texas Capital Securities looked at Wynn Resorts’ fourth-quarter results:
“4Q25 was 3% below consensus estimates. However, adjusted for hold (luck factor), 4Q results were in-line to slightly above consensus estimates. We believe 4Q25 results are largely neutral to shares and our thesis, though there could be modest near-term stock disruption on the headline miss given low investor sector sentiment/thin investor patience in the space. We continue to believe Wynn is likely to outperform in both Las Vegas (ex-Encore room renovation) and Macau in 2026E, which comes ahead of its 1Q27E Al Marjan (UAE) opening, which we believe is worth $32 per share and largely not in current share valuation. Our 2026E/2027E estimates are largely unchanged. Maintain Buy.”
DoubleDown Interactive
Josh Nichols of B Riley Securities weighed in Double Down Interactive on February 12:
“Buy-rated DoubleDown Interactive ($22 price target) reported 4Q revenue of $96 million (+16.9% year-over-year) that came in below consensus of $99 million and our $100 million, but with EBITDA of $40.6 million (42.4% margin) beating our and consensus $38 million by 6%, driven by a standout direct-to-consumer sales accounting to 33% of social casino revenue that far exceeded the 20%+ 2025 exit target. We believe this direct-to-consumer inflection is the most important development in the quarter, directly compressing DDI’s largest cost line and validating a structural margin expansion story that the market has overlooked.”
