Macquarie: DraftKings Still One of Gaming’s ‘Most Compelling’ Growth Stories

DraftKings (NASDAQ: DKNG) stock perked up in recent days and could have more upside ahead of it as the gaming company capitalizes on prediction market and sports wagering momentum.

In a report to clients out earlier today, Macquarie analyst Chad Beynon said DraftKings “remains one of the most compelling structural growth stories in Gaming,” adding that investors can tap into those traits at an “attractive valuation.” He didn’t overlook the sportsbook operator’s mediocre second-quarter results, which were hampered by customer-friendly World Cup outcomes, but he noted the operator was proficient on the customer acquisition front during the April through June period.

When it delivered quarterly results last week, Boston-based DraftKings told investors customer acquisition jumped 73% during the June quarter while the related costs dipped 8%. Beynon rates the stock “outperform” with a $38 price target, implying upside of approximately 52% from where it resides at this writing.

Prediction Markets an Opportunity, Not a Threat

For about a year now, yes/no exchanges have been viewed as competitive threats to sportsbook operators and the culprits behind share price erosion for the likes of DraftKings and FanDuel parent Flutter Entertainment (NYSE: FLUT).

However, Beynon sees DraftKings scaling more rapidly than expected in prediction markets, indicating that the nascent industry could become a long-term tailwind for the stock.

DraftKings rolled out its DKeX exchange in late June, meaning its DraftKings Predictions platform is fully integrated, allowing the operator to fully control the economics of its event contracts offering. The company noted more than 600,000 customers have engaged with DraftKings Predictions at some point this year and client retention is comparable to what’s seen with the operator’s sportsbook.

Momentum Into NFL Season

DraftKings stock is cobbling together momentum at just the right time because college football and the start of the 2026 NFL season are right around the corner – campaigns that are likely to bring fresh tests for prediction market and sportsbook operators.

In another potential bright spot for DraftKings, the gaming firm points out that parlays or combos are already accounting for 20% of turnover on DraftKings Predictions and that’s without the benefit of football — the most wagered on sport in the U.S.

“Management’s July/NFL commentary suggests the company enters the second half of 2026 with significant momentum,” says Beynon.