Fantasy sports and betting company DraftKings (NASDAQ: DKNG) will be announcing earnings results tomorrow after market close. Here’s what to look for.
DraftKings met analysts’ revenue expectations last quarter, reporting revenues of $1.65 billion, up 16.8% year on year. It was a mixed quarter for the company, with a beat of analysts’ EPS estimates but full-year revenue guidance missing analysts’ expectations. It reported 4.2 million users, down 2.3% year on year.
Is DraftKings a buy or sell going into earnings? Read our full analysis here, it’s free for active Edge members.
This quarter, the market is expecting DraftKings’s revenue to be flat year on year, slowing from the 36.9% increase it recorded in the same quarter last year.
Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business will stay the course heading into earnings. DraftKings has missed Wall Street’s revenue estimates multiple times over the last two years.
Looking at DraftKings’s peers in the consumer discretionary - gaming solutions segment, some have already reported their Q2 results, giving us a hint as to what we can expect. Rush Street Interactive delivered year-on-year revenue growth of 46.3%, beating analysts’ expectations by 7.1%, and Churchill Downs reported revenues up 4.9%, in line with consensus estimates. Rush Street Interactive traded down 13% following the results while Churchill Downs was also down 6.6%.
Read our full analysis of Rush Street Interactive’s results here and Churchill Downs’s results here.
Investors in the consumer discretionary - gaming solutions segment have had steady hands going into earnings, with share prices up 1.7% on average over the last month. DraftKings is down 18.5% during the same time and is heading into earnings with an average analyst price target of $34.84 (compared to the current share price of $21.93).
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