Key Stats for DraftKings Stock

• Current Price: $25.70
• Target Price (Mid): ~$160
• Street Target: ~$35
• Potential Total Return: ~525%
• Annualized IRR: ~50% / year
• Earnings Reaction: 5.43% (5/7/26, Q1 2026 report)
• Max Drawdown: 57.04% (3/27/26)

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What Happened?

DraftKings (DKNG) spent most of 2026 stuck near its lows, and then it flipped a switch. On June 26, the stock closed up 11.26% at $25.70 after the company turned on DKeX, its own prediction markets exchange. For a stock that had fallen roughly 35% year to date and bottomed with a 57% drawdown on March 27, that is the kind of single-day move that forces a question. Did the market just wake up to something real, or did one product launch get oversold as salvation for a stock that has frustrated holders for a year?

The launch itself is straightforward to describe and harder to value. DraftKings Predictions had been running since December on rails it did not own, routing every contract through CME Group’s derivatives exchange and sourcing additional markets through Crypto.com. With DKeX now live, DraftKings owns the plumbing. The exchange runs on the technology, and the CFTC (Commodity Futures Trading Commission, the federal regulator for these contracts) licensed the company picked up when it bought Railbird Technologies last October. Owning the stack means DraftKings keeps the exchange fees it used to pay out, and it controls which contracts get listed.

Why the market cared this much

The reason the move was this big is the volume behind it. For the week ended June 21, DraftKings Predictions generated approximately $3.4 billion in annualized consumer volume and approximately $11.3 billion in annualized total trading volume. That is up sharply from $1.3 billion and $3.1 billion in May. When trading was small, renting exchange capacity from CME made sense. At billions of dollars a week, the fee that used to leave the building becomes material money DraftKings keeps. The launch also happened to land right as the World Cup pushed prediction volume higher, which is not an accident in the timing.

This is the exact strategy CFO Alan Ellingson laid out three weeks earlier. Speaking at an industry symposium on June 4, Ellingson described the goal as owning every link in the chain: “We have almost all the pieces right now. We recently did an acquisition of a company called Rail, which is the exchange… we own the exchange, and we will, we believe we can capture all the economics long term.” DKeX is that sentence becoming a live product. It matters because vertical integration is the difference between earning a clip of each trade and earning the whole spread.

Ellingson was also blunt about why prediction markets could carry better economics than the core sportsbook. State taxes and revenue-share payments weigh on betting margins. As he put it, “Prediction markets don’t have any of these headwinds to the margins. So in theory, the margins for prediction markets could be meaningfully higher.” That is the structural case bulls are buying.

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The Street is moving, but not all the way

The day of the launch, Citizens analyst Jordan Bender raised his price target to $36 from $34 while keeping a Market Outperform rating. The firm models around $633 million of free cash flow in 2026, rising to around $1.1 billion in 2027, and frames DraftKings as the company best positioned to become the leading acquirer of prediction-market customers, targeting 2 million to 3 million new customers in 2026. Guggenheim sits at $35 with a Buy, and the broader Street mean target is around $35, against 23 Buys, 5 Outperforms, 6 Holds, and 1 Underperform.

Here is the tension. The Street targets sit around $35, roughly 36% above the current price, which is constructive but hardly euphoric. The bears are not hiding. Bank of America stayed neutral even while lifting its long-term industry estimate, warning that 2026 losses from the prediction push could run as high as $550 million against the company’s guidance of $200 million to $300 million. Benchmark, which still rates the stock a Buy at $29, flagged roughly $120 million of adjusted EBITDA pressure in the second quarter from customer-friendly sports outcomes and accelerated prediction-market spend around the World Cup. The whole bull case rests on a J-curve: spend hard now to acquire customers, monetize them later. If the “later” slips, the stock has shown it will not wait patiently.

Where DraftKings sits against peers

On forward sales, DraftKings looks cheap relative to its own history but not relative to the gaming group on every line. The stock trades at around 1.95x NTM EV/Revenues, below peers like Aristocrat Leisure at around 5.85x and Evolution AB at around 4.81x, and roughly in line with Flutter Entertainment at around 1.59x. On NTM EV/EBITDA, though, DraftKings sits at around 16.1x versus a peer median near 7.6x, a clear premium. That gap is the market pricing in DraftKings’ faster forward growth and the optionality of the prediction-market business, neither of which most casino-heavy peers carry. Whether that premium is justified comes down to one thing: whether prediction markets convert volume into profit on the timeline management implies. The revenue line says yes is plausible. The EBITDA line says you are paying up for it today.

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TIKR Advanced Model Analysis

• Current Price: $25.70
• Target Price (Mid): ~$160
• Potential Total Return: ~525%
• Annualized IRR: ~50% / year

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This article uses the TIKR mid-case scenario, which is the most balanced read of the model and the one that does not lean on best-case assumptions to make the math work. On those mid-case inputs realized at the end of 2030, the model points to a stock price of around $160, a total return of around 525% over roughly 4.5 years, and an annualized IRR of around 50%.

Two revenue drivers carry that forecast. First, continued mid-single-digit to low-double-digit growth in the core sportsbook and iGaming business as more states mature and parlay mix climbs. Second, the new prediction-markets revenue stream, which currently contributes close to nothing but which management and Citizens both expect to scale into a meaningful line over the back half of the decade. The margin driver is the one Ellingson named directly: prediction markets carry no state-tax or revenue-share drag, so as that mix grows, blended margins should expand. The model’s mid-case assumes net income margins reaching the low 30% range by the forecast horizon.

The primary risk is timing and spending discipline. DraftKings is funding customer acquisition out of profits from the rest of the business, and if the payback periods stretch or losses run hotter than the $200 million to $300 million guided, the inflection slips and the multiple compresses. 

The upside: prediction markets convert their volume into high-margin revenue management, which is promising, and DraftKings owns the whole stack to capture it. 

The downside: the J-curve spend keeps eating EBITDA, sports outcomes stay unfavorable, and a stock already near its lows tests them again.

Conclusion

The next read on this thesis is the Q2 2026 report on August 5. The number that matters is not headline revenue, it is what management says about prediction-market customer-acquisition cost and payback periods, and whether second-quarter adjusted EBITDA absorbs the roughly $120 million headwind Benchmark flagged without management walking back full-year guidance. Good looks like prediction volume holding its World Cup gains into July and a reaffirmed path to the $633 million free-cash-flow figure. Bad looks like losses drifting toward Bank of America’s $550 million warning with no offsetting volume retention. DKeX gave the bulls their proof that the business can scale. August will show whether it can pay.

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Should You Invest in DraftKings?

The only way to really know is to look at the numbers yourself. TIKR gives you free access to the same institutional-quality financial data that professional analysts use to answer exactly that question.

Pull up DraftKings, and you’ll see years of historical financials, what Wall Street analysts expect for revenue and earnings in the quarters ahead, how valuation multiples have moved over time, and whether price targets are trending up or down.

You can build a free watchlist to track DraftKings alongside every other stock on your radar. No credit card required. Just the data you need to decide for yourself.

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Disclaimer:

Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!