DraftKings Inc. (NASDAQ:DKNG) shares are trading lower on Monday. The company is hosting its next Investor Day on March 2.
• DraftKings shares are experiencing downward pressure. What’s pulling DKNG shares down?
BofA Securities analyst Shaun C. Kelley expects management to highlight the DraftKings Predictions initiative and outline medium-term financial targets.
Also, the analyst expects the company to discuss the total addressable market for prediction markets alongside an updated OSB and iGaming TAM, and provide revised revenue and profitability outlooks for the core business through 2028 and potentially 2030.
The event should also include deeper insights into recent customer acquisition and retention trends amid concerns around prediction-market cannibalization, adds the analyst.
Possible Estimates Revision
Kelley notes that DraftKings had previously outlined FY28 targets of $7.1 billion in revenue and EBITDA of $2.1 billion.
The analyst thinks the company may lift its revenue outlook to roughly $8.5 billion–$9.1 billion, including about $8.2 billion from core sports betting and approximately $650 million in prediction market fees.
At the same time, 2028 EBITDA expectations could be revised lower to around $1.5 billion–$1.7 billion, comprising roughly $1.5 billion from the core business and $100 million–$150 million from Predictions.
Expects TAM Growth
The analyst revised the total addressable market (TAM) outlook, estimating that prediction markets (PMs) could ultimately reach $1.3 trillion in total volume.
By 2028, Kelley projects the market to grow to around $600 billion, with DraftKings potentially capturing 10%–20% of that share.
While this could result in a steeper near-term J-curve, the company is expected to focus on the long-term growth opportunity and the advantages of operating a vertically integrated exchange, adds the analyst.
DKNG Price Action: DraftKings shares are down 1.82% at $21.91 at publication on Monday.
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