Sports-betting firm DraftKings (DKNG) recorded its worst single-game loss ever in week one of the NFL season, according to four-star Citizens Equity Research analyst Jordan Bender. The blow came during the Buffalo Bills–Baltimore Ravens game, where multiple player props hit and bettors loaded up on the Bills moneyline, both before the game and as the team staged a comeback after being down 15 points. Because so many people bet on that high-profile matchup, the result had an outsized effect on DraftKings’ hold rate.
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Nevertheless, even with that costly game, Bender explained that the rest of the NFL season has started out as expected for DraftKings. Excluding the Bills game, both betting volume and hold rates over the first two weeks lined up with the company’s high targets. DraftKings has also outperformed FanDuel (FLUT) in app downloads early this season, with some of that momentum likely tied to Netflix’s (NFLX) streaming of the Canelo Alvarez–Terence Crawford fight, which drew more attention to betting apps across the industry.
Separately, 4.5-star Jefferies analyst David Katz noted that while the first two weeks of this season have been mixed, the overall quarter-to-date picture remains positive. He added that last year’s unusually strong week two makes comparisons tougher, but longer-term trends continue to favor DraftKings, FanDuel, BetMGM (MGM), and Rush Street Interactive (RSI). However, investors will be paying close attention to these early numbers after last year’s NFL season cut into profits when favorites won at their highest rate in 20 years, creating “customer-friendly” outcomes.
Is DKNG Stock a Good Buy?
Turning to Wall Street, analysts have a Strong Buy consensus rating on DKNG stock based on 25 Buys and two Holds assigned in the past three months, as indicated by the graphic below. Furthermore, the average DKNG price target of $55.36 per share implies 27.8% upside potential.
