Online gambling has exploded over the last several years. We see the advertisements everywhere, and as more states legalize it, it looks like it’s here to stay. Simply put, everybody wants to roll the dice.

The industry also offers a unique investment opportunity. One of the titans in the space, DraftKings (DKNG Quick QuoteDKNG - Free Report) , is slated to release quarterly results on Friday, August 5^th, before the market opens.

DraftKings is a multi-channel provider of sports betting and gaming technologies, powering sports and gaming entertainment for 50 operators across more than 15 regulated U.S. and global markets. It’s the only U.S.-based vertically integrated sports betting operator.

In addition, the company boasts a Zacks Rank #2 (Buy). How does the gambling titan shape up heading into the print? Let’s find out.

Share Performance & Valuation

Over the last year, DraftKings shares have plunged, losing more than two-thirds of their value and being stuck on a nasty downtrend throughout the period.

Image Source: Zacks Investment Research

However, take a look at the chart below.

Image Source: Zacks Investment Research

DKNG shares have been on a parabolic run over the last month, tacking on an impressive 32% in value and crushing the S&P 500’s performance. After hiding all year long, buyers have finally launched their counterattack.

DraftKings valuation levels appear slightly elevated, further bolstered by its Style Score of an F for Value. The company’s forward price-to-sales ratio resides at 5.4X, well below its median of 18.6X since IPO in 2020 but representing a steep 27% premium relative to the general market.

Image Source: Zacks Investment Research

Quarterly Estimates

One analyst has upped their earnings outlook for the quarter, with the Consensus Estimate Trend inching up 1.1%. The -$0.87 Zacks Consensus EPS Estimate reflects a 15% decrease in quarterly earnings year-over-year.

Image Source: Zacks Investment Research

However, the company’s top-line is in much better condition – the quarterly revenue estimate of $438 million pencils in a sizable 47% double-digit uptick in quarterly sales year-over-year.

Quarterly Performance & Market Reactions

DraftKings has struggled to report bottom-line results above expectations, recording seven EPS misses over its nine quarterly reports. However, the narrative is changing – DKNG has recorded back-to-back bottom-line beats over its last two prints.

Additionally, top-line results have been rock-solid, with the company recording seven revenue beats over its nine quarterly prints. The chart below illustrates DraftKings’ revenue on a quarterly basis.

Image Source: Zacks Investment Research

It’s worth noting that the market has reacted poorly as of late to the company’s quarterly results, with shares moving downwards following each of its previous two earnings releases.

Putting Everything Together

DraftKings shares have lost immense value over the last year, but buyers have stepped up significantly over the previous month, driving shares upwards.

The company’s valuation levels appear slightly elevated relative to the general market but are low relative to where shares have traded historically.

Earnings are forecasted to take a sizable hit, but the top-line is projected to register serious growth. In addition, the company has repeatedly recorded revenue beats, and the bottom-line has found consistency as of late.

Heading into the print, DraftKings (DKNG Quick QuoteDKNG - Free Report) boasts a Zacks Rank #2 (Buy) with an Earnings ESP Score of 1.3%.