Draftkings Inc (DKNG)
NASDAQ:DKNG
Want to see DKNG full AI Analyst Report?
Top Page
DraftKings
(NASDAQ:DKNG)
Select Model
Select Model
Rating:68Neutral
Price Target:
$28.00
▲(22.70% Upside)
Action:Reiterated
Date:05/09/26
The score is driven primarily by improving financial performance—especially strong operating and free cash flow and a turn to positive earnings—tempered by high leverage and thin margins. The earnings call adds support via strong recent execution, improving profitability, and buybacks, though conservative guidance and investment-related uncertainty remain. Technicals are moderately positive but still below longer-term moving averages, while valuation support is limited due to non-meaningful P/E and no dividend yield data.
Positive Factors
Cash Generation
Sustained, large free cash flow provides durable funding for growth, product investment and capital returns without needing frequent external financing. Strong cash conversion despite modest accounting profits increases strategic optionality and resilience across a 2–6 month horizon.
Negative Factors
Elevated Leverage
High leverage relative to a modest equity base constrains financial flexibility and increases sensitivity to cash‑flow shocks or higher marketing spend. Debt load limits room for opportunistic investments and raises refinancing and covenant risks if results soften.
Read all positive and negative factors
Positive Factors
Negative Factors
Cash Generation
Sustained, large free cash flow provides durable funding for growth, product investment and capital returns without needing frequent external financing. Strong cash conversion despite modest accounting profits increases strategic optionality and resilience across a 2–6 month horizon.
Read all positive factors
DraftKings Key Performance Indicators (KPIs)
Any
Monthly Unique Payers
Tracks the number of distinct users placing bets each month, highlighting customer engagement and the platform's ability to attract and retain a loyal user base.
Tracks the number of distinct users placing bets each month, highlighting customer engagement and the platform's ability to attract and retain a loyal user base.
Data provided by:
The Fly
The FlyDraftKings (DKNG) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$22.91B
Dividend YieldN/A
Average Volume (3M)12.01M
Price to Earnings (P/E)125.0
Beta (1Y)1.45
Revenue Growth25.80%
EPS GrowthN/A
CountryUS
Employees5,100
SectorConsumer Cyclical
Sector Strength84
IndustryGambling, Resorts & Casinos
Share Statistics
EPS (TTM)0.12
Shares Outstanding495,742,800
10 Day Avg. Volume14,506,306
30 Day Avg. Volume12,013,467
Financial Highlights & Ratios
PEG Ratio-34.22
Price to Book (P/B)20.25
Price to Sales (P/S)2.11
P/FCF Ratio19.74
Enterprise Value/Market Cap0.56
Enterprise Value/Revenue2.03
Enterprise Value/Gross Profit4.85
Enterprise Value/Ebitda32.58
Forecast
1Y Price Target
$34.63Price Target Upside51.76% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering30
EPS Forecast (FY)0.24
Revenue Forecast (FY)$6.79B
DraftKings Business Overview & Revenue Model
Company Description
DraftKings Inc. operates a digital sports entertainment and gaming company. It offers multi-channel sports betting and gaming technologies, powering sports and gaming entertainment for operators in 17 countries. The company operates iGaming throug...
How the Company Makes Money
DraftKings primarily makes money from real-money gaming revenue generated on its online Sportsbook and iGaming platforms, supplemented by revenue from fantasy sports contests and other ancillary sources.
1) Online Sportsbook (sports betting)
- Co...
DraftKings Earnings Call Summary
Earnings Call Date:Feb 12, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Jul 31, 2026
Earnings Call Sentiment Positive
The call highlights a strong operational and financial quarter and year: record Q4 revenue and margin expansion, substantial adjusted EBITDA growth, first‑time GAAP net income, meaningful Sportsbook outperformance, active share repurchases, and a clear strategic push into a potentially large Predictions market with favorable regulatory movement. Offsets include conservative FY2026 guidance, prior guidance execution issues (management acknowledged a miss), early‑stage costs and uncertainty around Predictions monetization, flat overall MUPs (impacted by Jackpocket), and short‑term variance from sports outcomes. On balance, the positive results, scale, margin expansion and new growth initiatives materially outweigh the risks and near‑term costs.Positive Updates
Record Quarterly Revenue and Margin Expansion
Fourth quarter revenue grew 43% year‑over‑year to nearly $2.0 billion; adjusted EBITDA was $343 million (4x the prior year period) and adjusted EBITDA margin expanded by more than 1,000 basis points year‑over‑year to 17%.
Negative Updates
Conservative FY2026 Guidance and Implied Deceleration
FY2026 guidance is conservative relative to FY2025 performance (management intentionally lowered guide to avoid misses), implying slower revenue growth versus fiscal 2025's 27% increase; management declined to include Predictions revenue in the guide.
Read all updates
Q4-2025 Updates
Positive
Negative
Record Quarterly Revenue and Margin Expansion
Fourth quarter revenue grew 43% year‑over‑year to nearly $2.0 billion; adjusted EBITDA was $343 million (4x the prior year period) and adjusted EBITDA margin expanded by more than 1,000 basis points year‑over‑year to 17%.
Read all positive updates
Company Guidance
DraftKings guided fiscal 2026 revenue of $6.5–$6.9 billion and adjusted EBITDA of $700–$900 million, noting those ranges reflect planned investments in Predictions, incremental marketing (tens of millions of dollars of incremental spend and some fixed head‑count costs), and line‑of‑sight jurisdiction launches (mentioned Maine iGaming and Alberta) while assuming state tax rates remain consistent; management said no material Predictions revenue was included in the guide but expects upside from that initiative and will remain active in share repurchases as adjusted EBITDA grows (16 million shares repurchased in FY2025, 8 million in Q4). The guidance is framed off a FY2025 base where revenue grew 27% to above $6 billion, adjusted EBITDA more than tripled to over $600 million (Q4 revenue nearly $2.0 billion, Q4 adjusted EBITDA $343 million and a 17% adj. EBITDA margin), and Sportsbook scale included $54 billion handle (+11% YoY for FY2025; Q4 handle +13% YoY), Q4 Sportsbook revenue of $1.4 billion (+64% YoY), Sportsbook net revenue margin up ~250 bps to 8%, parlay handle mix up ~500 bps, Q4 hold slightly above 12%, and a 2025–2026 NFL hold of 16%.DraftKings Financial Statement Overview
Summary
Income Statement
74
Positive
Balance Sheet
54
Neutral
Cash Flow
83
Very Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 6.29B | 6.05B | 4.77B | 3.67B | 2.24B | 1.30B |
| Gross Profit | 2.63B | 2.50B | 1.82B | 1.37B | 756.19M | 501.86M |
| EBITDA | 391.05M | 259.67M | -319.35M | -586.65M | -1.27B | -1.39B |
| Net Income | 58.64M | 3.71M | -507.29M | -802.14M | -1.38B | -1.52B |
Balance Sheet | ||||||
| Total Assets | 4.31B | 4.53B | 4.28B | 3.94B | 4.04B | 4.07B |
| Cash, Cash Equivalents and Short-Term Investments | 999.40M | 1.60B | 788.29M | 1.27B | 1.31B | 2.15B |
| Total Debt | 1.34B | 1.93B | 1.34B | 1.35B | 1.32B | 1.32B |
| Total Liabilities | 3.70B | 3.90B | 3.27B | 3.10B | 2.72B | 2.39B |
| Stockholders Equity | 605.05M | 631.46M | 1.01B | 840.31M | 1.32B | 1.68B |
Cash Flow | ||||||
| Free Cash Flow | 678.52M | 647.50M | 407.59M | -115.14M | -729.16M | -517.78M |
| Operating Cash Flow | 733.43M | 662.86M | 417.77M | -1.75M | -625.52M | -419.51M |
| Investing Cash Flow | -175.19M | -166.00M | -566.60M | -90.36M | -208.77M | -195.02M |
| Financing Cash Flow | -716.41M | -222.46M | -144.47M | -63.22M | -16.73M | 1.14B |
DraftKings Technical Analysis
Positive
22.82
Price Trends
23.65
Positive
26.29
Negative
31.99
Negative
Market Momentum
0.57
Negative
61.13
Neutral
51.77
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DKNG, the sentiment is Positive. The current price of 22.82 is below the 20-day moving average (MA) of 24.11, below the 50-day MA of 23.65, and below the 200-day MA of 31.99, indicating a neutral trend. The MACD of 0.57 indicates Negative momentum. The RSI at 61.13 is Neutral, neither overbought nor oversold. The STOCH value of 51.77 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for DKNG.
DraftKings Risk Analysis
DraftKings disclosed 10 risk factors in its most recent earnings report. DraftKings reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
DraftKings Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
80 Outperform | $6.99B | 15.71 | 28.52% | 1.34% | 19.93% | 79.81% | |
73 Outperform | $6.44B | 61.26 | 26.36% | ― | 28.20% | 310.24% | |
68 Neutral | $22.91B | 124.99 | 7.88% | ― | 25.80% | ― | |
68 Neutral | $5.88B | 14.94 | 79.86% | 0.84% | 3.45% | 272.47% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
60 Neutral | $2.21B | -217.94 | -44.48% | ― | 6.38% | -1099.20% | |
53 Neutral | $16.93B | 21.12 | -3.56% | ― | 18.90% | -172.89% |
* Consumer Cyclical Sector Average
DKNG
DraftKings
25.54
-10.00
-28.14%
BYD
Boyd Gaming
78.09
5.75
7.94%
PENN
PENN Entertainment
16.12
1.92
13.52%
FLUT
Flutter Entertainment PLC
97.50
-142.46
-59.37%
RSI
Rush Street Interactive
28.00
16.39
141.17%
SGHC
Super Group (SGHC)
13.87
5.87
73.48%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.