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DraftKings (NASDAQ:DKNG) is set for a big ride with the launch of the company's online sportsbook in North Carolina on March 11. Earlier this year, DraftKings (DKNG) and NASCAR agreed to terms on a written designation agreement, paving the way the way the digital sports entertainment and gaming company operates in the state. Following the launch in North Carolina, DraftKings Sportsbook will be available in 27 US states, plus Ontario, Canada. DraftKings (DKNG) will hold a launch event in collaboration with NASCAR, with commentary from Carolina Panthers legend Greg Olsen, DraftKings (DKNG) Jeremy Elbaum, business director, and Zack Hawkins, North Carolina state representative. The timing of the launch in North Carolina is advantageous, as the men's and women's NCAA tournaments begin in less than two weeks and the NASCAR season is in full swing. North Carolina is the ninth largest state in the US by population and is projected to have one of the top six addressable markets for sports betting leads.
Next week we'll also see a new feature on Comcast's (CMCSA) Xfinity X1 TVs that will see live odds provided by DraftKings (DKNG) placed directly on Xfinity X1 TVs. Xfinity customers will be able to view live odds from DraftKings (DKNG) right on their TV while watching games and sporting events, where they can find betting information while placing bets in the DraftKings Sportsbook app. Bets can be placed by scanning a QR code which can add the bet to a DraftKings betting slip on the customer's mobile, where the transaction can be completed.
DraftKings (DKNG) stock took a small hit after the Boston-based company's fourth-quarter earnings report, but Wall Street analysts remain positive on profitability prospects for 2024-2025.
Morgan Stanley analyst Stephen Grambling noted that while fourth-quarter results fell short of consensus expectations, guidance comments from DraftKings (DKNG) combined with continued improvements in structural retention and its acquisition of Jackpocket revealed several factors that will continue to drive DKNG consensus estimates higher. Grambling and his team believe the main talking points for DKNG will now shift from the ability to generate positive cash flow to capital allocation.
Meanwhile, CBRE Equity Research analyst John DeCree sees upside for DraftKings (DKNG) with the Jackpocket acquisition. It was highlighted that the online lottery specialist has a large database of high-intent, high-frequency users that could serve as a unique customer acquisition channel with a significant cross-sell opportunity for DKNG iGaming and OSB core products. . The add-on acquisition is believed to help reduce overall customer acquisition costs for DKNG and enhance the potential long-term value of customers, while expanding the company's funnel.
Pursuing Alpha, investment group leader Howard Jay Klein believes the sports betting market will continue to be dominated by major players DraftKings (DKNG) and FanDuel (FLUT).
“DKNG's market share is estimated to average a range between 35% and 39% depending on the state or a snapshot of the stock per month. FanDuel sits at ~$42%, again varying depending on the state or a given stock in “A great event. Together, they currently own, and I mean own, ~74% of the total market and, I believe, will continue to own for the next six years.”
Of interest, detailed analysis carried out by the New York Post declared the DraftKings Sportbook app the winner of a showdown with the FanDuel app (FLUT) in terms of customer appeal.
DraftKings (DKNG) stock is up 18.4% so far this year and is trading comfortably above its 100- and 200-day moving averages. The short interest on DKNG stands at just 4.4% of the total float. Looking Alpha Quant Rating on DKNG ranks in the top 25% of all stocks in the broad online casino, gaming and sports betting sector.
