Football Season Is Here and DraftKings Stock Is Surging
Since last February, football fanatics have been eagerly awaiting the return of the NFL season. Last week, while loyalists donned their jerseys and ordered their wings, shareholders of one consumer discretionary stock were also being rewarded.
Currently, 38 states, Washington, D.C., and Puerto Rico have legalized sports betting, and sportsbook companies like DraftKings (NASDAQ: DKNG) have been raking it in.
The stock, which is up more than 26% in 2025, is likely to get a near-term boost. According to CEO Jason Robins, DraftKings was already seeing record numbers heading into the NFL season—sports betting’s most lucrative time of year.
According to Grand View Research, the industry was valued at $100.9 billion in 2024 and is expected to grow at a CAGR of 11% from 2025 to 2030, when it reaches a valuation of $187.39 billion.
For patient shareholders of DKNG, there is likely more in store as the stock continues to build on its nearly 45% gain since its year-to-date (YTD) bottom on April 4 and sports gambling’s biggest season now underway.
An Under-the-Radar Consumer Discretionary Play
Founded in 2012, the digital sports entertainment and gaming company specializes in daily fantasy sports, sports betting, and iGaming products. It falls into the consumer discretionary sector, which despite a lackluster 3.80% YTD gain has performed better of late.
As a whole, it’s up 7.60% over the past three months—third best among the S&P 500’s 11 sectors and trailing only technology (12.16%) and communication services (9.45%) over the same period.
After being taken public by a special purpose acquisition company in 2020, the stock has gained more than 817%, ballooning in value while continuing to acquire gaming licenses, partnerships with professional sports leagues, teams, and media organizations.
DraftKings faced some headline risk earlier this year when it was reported on June 12 that—in response to a sports wagering tax passed by the Illinois state legislature—the company implemented a 50-cent transaction fee for all mobile and online bets placed in the state, which took effect on September 1, 2025.
While the stock fell 3.90% from June 12 to June 13, investors who understood the company’s healthy fundamentals and didn’t sell were rewarded.
The stock has gained nearly 26% since, much of that concerns the broader picture. As far as consumer discretionary plays go, sports betting has proven resilient in the face of heightened market volatility, slipping investor sentiment, and economic concerns.
According to the American Gaming Association, legal betting in the United States is forecast to grow 8.5% during the current NFL season to $30 billion.
“We’re seeing big numbers, record numbers,” Robins told CNBC on Sept. 4. “We’re seeing nothing to suggest that there’s any slowdown in the numbers for our business right now, everything is going up.”
DraftKing’s Rock-Solid Financials Are the Extra Point
When the company reported Q2 earnings on Aug. 7, 2025, it announced EPS of 30 cents, easily beating analysts’ consensus estimate of 16 cents. DraftKings also beat on revenue by posting $1.51 billion versus analysts’ expectations of $1.39 billion.
With a forward P/E multiple of 20.92, the company’s earnings are expected to grow 139.06% next year from 64 cents per share to $1.53 per share.
Engagement across social media handles saw a year-over-year (YOY) increase of 200% in Q2 2025, and the company achieved over 90% availability for MLB and NBA live markets. Meanwhile, DraftKings’ sportsbook net revenue increased 45% YOY.
It’s worth noting that DraftKings is operating at a loss. But importantly, those financials have drastically improved over the past several years.
In 2021, the company posted a loss of $1.523 billion. Last year, net income showed a loss of just $507 million. Put another way, the company cut its consolidated losses by nearly 67%.
At the same time, net cash flow from operating activities pivoted from a $420 million loss in 2021 to a $418 million gain in 2024—good for a 199.28% increase. While those are positive financial developments, financial metrics are rear-facing. But DraftKing’s Q2 earnings call suggested a playoff-bound future.
DraftKings Is Positioning Itself for Long-Term Success
In its most recent quarterly presentation, the company disclosed that it continues to reinvest in itself.
During the first two quarters of the year, DraftKings repurchased 6.5 million shares.
In his remarks, Robins stated that the company has maintained its fiscal year 2025 guidance, “with revenue expected to be closer to the high end of our range, highlighting the strength of our platform as we prepare for an exciting new state launch” in Missouri.
Analysts seem to agree, with 24 of 25 assigning the stock a Buy rating, and giving it a consensus price target of $55.12, or 20.16% potential upside from today’s share price.
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