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UBS upgraded DraftKings stock to "buy"
The shares of DraftKings Inc (NASDAQ:DKNG) are 3.8% higher to trade at $25.02 this morning, after UBS upgraded the sports gambling company to "buy" from "neutral." The analyst in coverage also raised its DKNG price target to $30, citing the potential growth the sports betting stock could see via expansion into new markets.
DraftKings stock sports an impressive 111.7% year-to-date lead. Earlier this month, a post-earnings bull gap helped the shares to their highest level since January 2022. DKNG has come a long way since breaching $11 on Dec. 28.
A shift in the options pits may keep the wind at the equity's back. This is per DKNG's Schaeffer's put/call open interest ratio (SOIR), which stands in the 77th percentile of the past 12 months. In other words, short-term traders have rarely been more put-biased.
DraftKings options can be had for a discount at the moment. The stock's Schaeffer's Volatility Index (SVI) of 49% sits higher than just 3% of readings from the past year. This suggests options players are pricing in relatively low volatility expectations right now.