TLDR
- DraftKings’ annualized prediction market total volume jumped 34% month-over-month in May to $3.1B
- Consumer volume in its Predictions product rose 24% month-over-month to $1.3B
- DKNG was up 1.4% in premarket trading Tuesday
- TD Cowen reiterated a Buy rating with a $30 price target; stock was trading at $25.01
- DraftKings aims to expand its super app framework to all 50 states
DraftKings (DKNG) stock was up 1.4% in premarket trading on Tuesday after the company released strong operating metrics from its fast-growing Predictions product.
The Boston-based company said annualized consumer volume in its Predictions offering rose 24% month-over-month in May to $1.3B. Annualized total volume traded climbed 34% month-over-month to $3.1B. The company noted these figures are preliminary, unaudited, and based on internal data.
DraftKings officially launched DraftKings Predictions on December 19, 2025. The product is now live across 38 U.S. states for at least some event contracts, with sports-event contracts available in 17 states.
The growth numbers look impressive, but context matters. Prediction market volume counts the dollar value of all contracts traded, including repeat in-and-out trades. That’s different from sports betting handle, which only counts money actually put at risk.
With that in mind, Kalshi is currently estimated to be doing mid-tens of billions of dollars per month in notional volume. Polymarket sits in the high single-digit to low-teens billions depending on the month. DraftKings is still a smaller player, but it’s moving fast.
TD Cowen Backs the Stock
TD Cowen reiterated its Buy rating on DKNG Monday, keeping its $30 price target. At $25.01, the firm’s own analysis pegs the stock as undervalued. InvestingPro puts fair value above both the current price and TD Cowen’s target.
The firm pointed to DraftKings‘ scaled online sports betting and iGaming platform as the foundation for durable profitability. It flagged product depth, structural hold, and operating leverage as key drivers. The company’s gross profit margin sits at 76.7%.
TD Cowen also noted that management is funding its prediction markets push from a strengthening core business. The firm views prediction markets as a large and underappreciated total addressable market, and has included DKNG in its Best Smidcap Ideas list.
UBS raised its price target to $49 following Q1 earnings that beat Street estimates on both revenue and EBITDA. Benchmark reiterated Buy with a $29 target. Citizens maintained a Market Outperform rating with a $34 target.
Super App Push Continues
DraftKings’ broader goal is to have its super app framework live nationwide, covering all 50 states. The product mix inside the app will vary by state depending on local law.
The company has filed new exchange products through the CFTC as it expands its prediction markets presence. Bank of America analysts have flagged a convergence between sports betting, crypto, and financial markets as a potential long-term growth driver for operators like DraftKings.
Net income is expected to grow this year, according to InvestingPro data.
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