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DraftKings (DKNG) to Report Q4 Earnings: What's in Store?

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DraftKings (DKNG - Free Report) is set to report fourth-quarter 2022 results on Feb 16.

The Zacks Consensus Estimate for revenues is pegged at $797.4 million, indicating an increase of 68.4% from the year-ago quarter’s levels.

The consensus mark for loss has moved north by 1 cent in the past 30 days and is currently pegged at 63 cents per share.

The company’s earnings beat the Zacks Consensus Estimate in three of the last four quarters and missed once. DraftKings has a trailing four-quarter earnings surprise of 14.52% 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-eps-surprise | DraftKings Inc. Quote

Factors to Consider

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

DraftKings is live with mobile sports betting in 18 states that collectively represent approximately 37% of the U.S. population following the launch of its online Sportsbook in Kansas on Sep 1, 2022. 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 third quarter, Average Revenue per Monthly Unique Payers was $100, up 114% year over year, attributed to strong customer engagement, a continued mix shift into DraftKings’ Sportsbook and iGaming products and reduced promotional intensity compared to the same period in 2021. 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 Maryland in the to-be-reported quarter. To further expand its reach in the addressable market and strengthen its user base, the company has been continuously working on adding depth to its mobile sports betting and iGaming products.

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.

DraftKings currently has an Earnings ESP of +2.49% 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 stocks worth considering, as our model shows that these have the right combination of elements to beat on earnings this season.

Endava (DAVA - Free Report) has an Earnings ESP of +1.47% and a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

Endava is set to report its second-quarter fiscal 2023 results on Feb 14. The Zacks Consensus Estimate for DAVA’s earnings is pegged at 68 cents per share, suggesting an increase of 7.94% from the prior-year period’s reported figure.

Airbnb (ABNB - Free Report) has an Earnings ESP of +8.10% and a Zacks Rank #3 at present.

Airbnb is scheduled to release its fourth-quarter 2022 results on Feb 14. The Zacks Consensus Estimate for ABNB’s earnings is pegged at 27 cents per share, suggesting an increase of 237.5% from the prior-year quarter’s reported figure.

TripAdvisor (TRIP - Free Report) has an Earnings ESP of +112.90% and a Zacks Rank #3 at present.

TripAdvisor is scheduled to release its fourth-quarter 2022 results on Feb 14. The Zacks Consensus Estimate for TRIP’s earnings is pegged at 5 cents per share. The company reported a loss of a cent per share in the prior-year quarter.

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

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