DKNG - DraftKings: Tailwinds On All Sides

2024-05-23 11:18:31 ET

Summary

• DraftKings' share price has jumped 25% this year, outperforming the broader market as it continues to rapidly gain new users.
• The company's recent launches in North Carolina and Vermont added ~10% more users than the company initially expected.
• DraftKings has a large addressable market, improving customer acquisition costs, and offers a wide range of sports and gaming options.
• The company recently posted a positive adjusted EBITDA and is also expecting $400 million in FCF this year, with plans to unveil a new capital allocation program next quarter.

Amid tough macro conditions that have consumers watching their spending on just about everything, one industry has held up quite well: gambling and gaming. The marquee 150th annual Kentucky Derby, hosted on the first Saturday of May each year, saw a record inflow of bets . And amid this backdrop and continual state expansion, leading sportsbook manager DraftKings ( DKNG ) is soaring as well....

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