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DraftKings (DKNG) to Report Q1 Earnings: What's in Store?

Zacks Equity Research
·4 min read

DraftKings DKNG is set to report first-quarter 2023 results on May 4.

The Zacks Consensus Estimate for revenues is pegged at $699.62 million, indicating an increase of 67.69% from the year-ago quarter’s levels.

The consensus mark for loss has moved south by 5 cents in the past 30 days and is currently pegged at 85 cents per share.

The company’s earnings beat the Zacks Consensus Estimate in the last trailing four quarters. DraftKings has a trailing four-quarter earnings surprise of 17.54%, on average.

Let’s see how things have shaped prior to this announcement.

DraftKings Inc. Price and EPS Surprise

 

DraftKings Inc. Price and EPS Surprise
DraftKings Inc. Price and EPS Surprise

DraftKings Inc. price-eps-surprise | DraftKings Inc. Quote

 

Factors to Consider

Increasing global demand for online gambling and sports betting is expected to have positively impacted DraftKings’ first-quarter performance.

DraftKings is live with mobile sports betting in 20 states that collectively represent approximately 42% of the U.S. population following the launch of its online Sportsbook in Ohio on Jan 1, 2023. The company operates iGaming in five states, representing approximately 11% of the U.S. population.

The company’s continuous efforts to expand the functionality and content offering of its Sportsbook product are expected to have driven customer acquisition, engagement and retention in the to-be-reported quarter.

In the fourth quarter, Average Revenue per Monthly Unique Payers was $109, up 42% year over year, attributed to an improvement in the company’s structural sportsbook hold rate, a continued mix shift into DraftKings’ Sportsbook and iGaming products and reduced promotional intensity compared with the same period in 2022. The trend is likely to have continued in the to-be-reported quarter.

The demand for iGaming, such as Roulette and Blackjack, benefited from a spike in user activity. The trend is expected to have continued in the to-be-reported quarter.

DraftKings launched its online sportsbook in Massachusetts in the to-be-reported quarter. DraftKings will also offer exclusive promotions, variety of bet types and more to customers in Massachusetts. This is expected to have expanded the reach of DraftKings in the to-be-reported quarter.

In the first quarter, DraftKings launched a standalone horse racing app in 12 states ahead of the derby week. This application is expected to have positively impacted the top line of the to-be-reported quarter.

What Our Model Says

Per the Zacks model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. This is the case here as you can see below.

DraftKings currently has an Earnings ESP of +0.18% and carries a Zacks Rank #3. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Other Stocks to Consider

Here are some other stocks worth considering, as our model shows that these have the right combination of elements to beat on earnings this season.

Certara CERT has an Earnings ESP of +5.41% and sports a Zacks Rank #1 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

Certara is set to report its first-quarter fiscal 2023 results on May 8. The Zacks Consensus Estimate for CERT’s earnings is pegged at 12 cents per share, suggesting an increase of 9.09% from the prior-year period’s reported figure.

Bitfarms BITF has an Earnings ESP of +180% and a Zacks Rank #2 at present.

Bitfarms is scheduled to release its first-quarter 2023 results on May 15. The Zacks Consensus Estimate is pegged at a loss of 3 cents per share, suggesting a decline of 250% from the prior-year quarter’s reported figure.

Insulet PODD has an Earnings ESP of +70.21% and flaunts Zacks Rank #1 at present.

Insulet is scheduled to release its first-quarter 2023 results on May 4. The Zacks Consensus Estimate for PODD’s earnings is pegged at 9 cents per share, suggesting a decrease of 77.5% from the prior-year quarter’s reported figure.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.


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Insulet Corporation (PODD) : Free Stock Analysis Report

DraftKings Inc. (DKNG) : Free Stock Analysis Report

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Zacks Investment Research