Want to see DKNG full AI Analyst Report?
Top Page
DraftKings
(NASDAQ:DKNG)
Select Model
Select Model
Rating:65Neutral
Price Target:
$31.00
▲(35.85% Upside)
Action:Reiterated
Date:06/01/26
DKNG scores solidly on improving financial performance—especially strong free cash flow and a turn to profitability—supported by a constructive, guidance-reaffirming earnings call with meaningful EBITDA growth. The score is held back by very high valuation (P/E ~203), elevated leverage versus equity, and a mixed technical picture that still shows longer-term downtrend pressure.
Positive Factors
Free cash flow generation
Sustained, sizable free cash flow (~$679M TTM) provides durable flexibility to fund growth, product investment, debt paydown, and buybacks without relying on equity raises. Over the next 2–6 months this strengthens the company’s ability to execute strategy and absorb shocks.
Negative Factors
Elevated leverage
Debt-to-equity near 2.2x leaves a relatively small equity cushion versus obligations. Over the next several months this limits financial flexibility for opportunistic investments or weathering revenue shocks and raises refinancing and interest‑service risk if trends weaken.
Read all positive and negative factors
Positive Factors
Negative Factors
Free cash flow generation
Sustained, sizable free cash flow (~$679M TTM) provides durable flexibility to fund growth, product investment, debt paydown, and buybacks without relying on equity raises. Over the next 2–6 months this strengthens the company’s ability to execute strategy and absorb shocks.
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
$23.02B
Dividend YieldN/A
Average Volume (3M)13.82M
Price to Earnings (P/E)210.1
Beta (1Y)1.34
Revenue Growth25.80%
EPS GrowthN/A
CountryUS
Employees5,100
SectorConsumer Cyclical
Sector Strength84
IndustryGambling, Resorts & Casinos
Share Statistics
EPS (TTM)0.12
Shares Outstanding496,128,800
10 Day Avg. Volume15,182,885
30 Day Avg. Volume13,818,327
Financial Highlights & Ratios
PEG Ratio34.79
Price to Book (P/B)20.25
Price to Sales (P/S)2.11
P/FCF Ratio19.74
Enterprise Value/Market Cap0.61
Enterprise Value/Revenue2.22
Enterprise Value/Gross Profit5.32
Enterprise Value/Ebitda34.79
Forecast
1Y Price Target
$36.05Price Target Upside57.97% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering26
EPS Forecast (FY)0.23
Revenue Forecast (FY)$6.78B
DraftKings Business Overview & Revenue Model
Company Description
DraftKings Inc. operates as a leading digital enterprise specializing in sports entertainment and gaming. The company provides sophisticated multi-channel sports betting and gaming technology solutions to operators across 17 countries, facilitatin...
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:May 07, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Jul 31, 2026
Earnings Call Sentiment Positive
The call conveyed a predominantly positive operational and financial picture: strong top‑line growth (17% YoY), outsized adjusted EBITDA improvement (64% YoY), margin expansion, and clear early traction in Predictions (rapid CAC declines and fast volume growth). Management reaffirmed FY guidance and highlighted profitable core momentum (Sportsbook strength, April performance, >$500M adjusted EBITDA over six months). Offsets include a planned $200M–$300M investment in Predictions that depresses near‑term EBITDA, deceleration in iGaming growth, moderated customer growth, and regulatory/consumer‑protection risks tied to Predictions. On balance the highlights and demonstrable profitability gains outweigh the headwinds and planned investments, but the Predictions program introduces execution and regulatory uncertainty that warrants monitoring.Positive Updates
Revenue and Top‑Line Growth
Q1 revenue increased 17% year‑over‑year, surpassing $1.6 billion; April soft‑close revenue was up 22% year‑over‑year.
Negative Updates
Significant Predictions Investment Will Pressure Near‑Term EBITDA
Company plans to invest approximately $200 million to $300 million in Predictions in 2026; management noted Q1 adjusted EBITDA would have exceeded $200 million if not for Predictions investments and the Arkansas launch, indicating a material near‑term drag on profitability.
Read all updates
Q1-2026 Updates
Positive
Negative
Revenue and Top‑Line Growth
Q1 revenue increased 17% year‑over‑year, surpassing $1.6 billion; April soft‑close revenue was up 22% year‑over‑year.
Read all positive updates
Company Guidance
DraftKings reaffirmed fiscal 2026 guidance of $6.5–$6.9 billion in revenue and $700–$900 million in adjusted EBITDA (a range that includes planned Predictions investment of roughly $200–$300 million this year); in Q1 it posted revenue just over $1.6 billion (+17% YoY) and adjusted EBITDA of $168 million (+64% YoY, and would have exceeded $200 million excluding Predictions spend and the Arkansas sportsbook launch), with Sportsbook revenue of $1.1 billion (+24% YoY), net revenue margin up 140 bps to 7.8%, parlay mix +~300 bps, adjusted gross margin +~200 bps YoY, and more than $500 million of adjusted EBITDA generated over the last six months; April soft-close trends were strong (handle +6%, revenue +22% YoY, >$100 million adj. EBITDA in April), Predictions metrics show CACs down >80% in April, annualized Predictions consumer volume >$1 billion and annualized total volume traded >$2.3 billion (up 38% and 43% MoM), management reiterated a $55–$80 billion gross revenue opportunity by 2030 with at least a 30% long-term adjusted EBITDA margin, and the company noted positive net income for a second consecutive quarter and nearly $100 million of share repurchases.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 | 401.71M | 303.41M | -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 | 1.92B | 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
25.19
Positive
24.42
Positive
29.03
Negative
Market Momentum
-0.02
Positive
50.69
Neutral
65.35
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 26.37, below the 50-day MA of 25.19, and below the 200-day MA of 29.03, indicating a neutral trend. The MACD of -0.02 indicates Positive momentum. The RSI at 50.69 is Neutral, neither overbought nor oversold. The STOCH value of 65.35 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 | $7.37B | 30.19 | 31.93% | 1.34% | 19.93% | 79.81% | |
76 Outperform | $6.53B | 3.85 | 79.86% | 0.84% | 3.45% | 272.47% | |
68 Neutral | $7.38B | 82.61 | 26.36% | ― | 28.20% | 310.24% | |
65 Neutral | $23.02B | 210.15 | 7.88% | ― | 25.80% | ― | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
58 Neutral | $2.95B | -3.28 | -44.48% | ― | 6.38% | -1099.20% | |
54 Neutral | $18.45B | -50.86 | -3.56% | ― | 18.90% | -172.89% |
* Consumer Cyclical Sector Average
DKNG
DraftKings
25.89
-14.69
-36.20%
BYD
Boyd Gaming
87.90
7.79
9.73%
PENN
PENN Entertainment
22.02
3.70
20.17%
FLUT
Flutter Entertainment PLC
106.03
-176.82
-62.51%
RSI
Rush Street Interactive
31.68
16.40
107.33%
SGHC
Super Group (SGHC)
14.51
3.57
32.58%
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.