What happened
Golden Nugget Online Casino (GNOG +0.00%) might finally be on a winning streak. A generally declining stock for most of this year, on Thursday the shares closed up by almost 11%. A new analysis of the company was quite positive on its prospects.
So what
On Tuesday, financial services company B. Riley initiated coverage on Golden Nugget stock with an unequivocal buy rating at a price target of $27 per share -- more than double the current level of $12.25.
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Analyst David Bain wrote:
We believe GNOG's sustained iGaming [i.e., online casino gaming] market share in New Jersey, the most mature U.S. legal iGaming market, justifies our conservative market share ramp assumptions in upcoming iGaming market go-lives and offers case study visibility to GNOG's profitability.
Bain also believes that Golden Nugget's focus on casino play makes it a better investment than the online sports-wagering operators that are currently popular, such as DraftKings. He feels that this focus, plus effective branding and a user experience that sets the company apart, make it quite the compelling investment.
Now what
Bain also writes that Golden Nugget's "recent and expected upcoming market entrances are set to triple its [total addressable market] by the end of next year."
Investors are excited that fresh opportunities for online gambling are popping up, with more states flipping the switch on legalization. So Golden Nugget, somewhat of a laggard stock in the segment so far this year, could very well be primed for a growth spurt.
