A poster boy for the burgeoning online sports gambling industry in the U.S., DraftKings (NASDAQ: DKNG) is a very strong buy, according to financial services provider Needham & Company. On Monday, Needham analyst Bernie McTernan initiated coverage of DraftKings with such a recommendation, placing the stock on the company's conviction list and slapping a price target of $81 on it. That level is nearly 37% above DraftKings' most recent closing price. Image source: Getty Images. "We see [DraftKings] as a leader in the emerging North America online gambling market, a $35 billion market opportunity," McTernan wrote in his research note on the company. "Despite mixed results in [New York], we see the current regulatory environment as supportive, which should lead to a significant growth in legislation, a key reason our '22 and '23 estimates are above consensus." Recently, more states across the U.S. have legalized some form of online sports wagering. At the moment, 11 of them permit full mobile betting. In 2022 New York will join this group, having legalized betting earlier this month; however, Governor Andrew Cuomo plans to run betting through the state's lottery operator. Additionally, online casino gambling has been sporadically legalized, although that universe is smaller -- only six states currently allow this. While DraftKings is known for sports, its DraftKings Casino offers online versions of traditional offerings such as poker and slots. With budgets taking brutal hits from the economic fallout of the coronavirus pandemic, states are hungry for quick and reliable new sources of tax revenue. Given that, McTernan's optimistic view of DraftKings' prospects seems entirely realistic. Perhaps that's why DraftKings beat the S&P 500 index Monday, rising 1.9% against the more or less flat performance of the benchmark stock indicator. 10 stocks we like better than DraftKings Inc.When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.* David and Tom just revealed what they believe are the ten best stocks for investors to buy right now… and DraftKings Inc. wasn't one of them! That's right -- they think these 10 stocks are even better buys. See the 10 stocks *Stock Advisor returns as of February 24, 2021 Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.Source