DraftKings soars after Morgan Stanley calls a bottom

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• Morgan Stanley fires off an upgrade on DraftKings (NASDAQ:DKNG) with shares down more than 75% from their highs.
• Analyst Thomas Allen: "While we and the market have been focused on near to medium-term profit concerns, we believe at the current price, one should not ignore that DKNG is a leading market share player in what will be a very large profitable market."
• DKNG trades at roughly 9X the firm's 2025 EBITDA estimate vs. 15X for high-growth Internet stocks.
• Looking ahead at the industry landscape, California could legalize online sports betting this year, which would add $2B to Morgan Stanley's total addressable market forecasts. Launches in Louisiana, Ohio, Maryland and Nebraska are all expected to drive upside as well.
• Shares of DraftKings (DKNG) are up 6.63% premarket to $20.60.
• Read Seeking Alpha author JR Research's breakdown on DraftKings.