I've been researching DraftKings and the sports-betting industry for a while now.
gotta say I really liked what I found, and I think it could be a great long-term investment opportunity... but still wanted to hear people's thoughts about $DKNG. (I posted full analysis with pictures and more data at r/growthstonks)
THE ONLINE BETTING industry
The market is worth $67 billion today and is estimated to reach about $93 billion by 2023—growing at roughly 11.5% per annum.
There are few reasons for the aggressive growth, First, more of our activities are taking place online, a trend that extends to betting as well.
The second is regulation. The U.S. Supreme Court uplifted the Professional and Amateur Sports Protection Act in May of 2018 to legalize sports betting on a federal level. Since then, 25 states have legalized sports betting.
SPORTS BETTING
The most popular activity by far is sports betting, which makes up over 40% of the total online betting market.
DraftKings
DraftKings is a sports betting, daily fantasy sports contest, and an iGaming operator.
In total, DraftKings now operates sportsbooks in 14 states and averages 1.5 million monthly unique paying customers across its online sportsbooks, iGaming, and daily fantasy offerings.
Financials
DraftKings's revenue keeps surging YOY, in Q2-2021 revenue reached $297,605M which is a 22% higher sales compared to the analyst expectations. last year the company delivered $74,998M in revenue.
The company also said that it had grown the number of monthly unique payers by 281% and the average revenue per monthly unique payer by 26%. In other words, fundamental growth was very strong.
Even though I really think that the potential for growth here is clear, the company still losing a lot of money, Cost of revenue spiked this quarter to $187,006M from $53,172M, and new loss reached $305,526M - even more than DraftKings's revenue.
DraftKings's revenue over the last 3 years- JIKA.IO
Comparison of DraftKings's revenue, Cost of revenue, and net profit - JIKA.IO
Another positive point in DraftKings's favor is the amount of cash the company has gathered since 2018. The company currently has $2.65 billion in cash, which compared to last year's results - $1.24 billion, is a 113% change.
DraftKings's cash on hand over the last 3 years- JIKA.IO
Analysts
Based on 13 analysts, 9 buy ratings, 4 hold ratings. -(tipranks)
MUST KNOW - LATEST NEWS
- DraftKings Is Acquiring Golden Nugget for $1.56 Billion, the Addition of Golden Nugget user base will enhance DraftKings’ reach across diverse customer demographics.
- DraftKings launches mobile sportsbook in Wyoming ahead of NFL kickoff.
I wonder what you guys think about DraftKings? will the company keep the momentum and can be a wise long-term play?
Sources:
Jika.io - compare companies financials
VisualCapitalist- betting industry info
tipranks- analysts reviews
DraftKings website - financial reports and news
Submitted September 08, 2021 at 08:55AM by Purple-Tutor5831 https://ift.tt/3jR5opp
