Shares of DraftKings were up 5.3% in extended trading on April 15 as the online betting company announced that it will be the official Sports Betting Partner of the National Football League (NFL) and will also extend its contract as an exclusive official Daily Fantasy Partner.
DraftKings’ (DKNG) Co-Founder, Chairman and CEO, Jason Robins said, “The way fans consume sports years from now will look drastically different, and it will be due in part to forward-thinking collaborations like our expanded relationship with the NFL today as an Official Sports Betting Partner and the exclusive Daily Fantasy Sports Partner.”
“We share the same vision as the NFL on fan engagement and believe this agreement will lead to new innovations that will ultimately enhance both the product on the field and on the screen,” Robins added.
DKNG will have the right as an official sports betting partner of NFL to integrate sports betting content directly into NFL.com and the NFL app. The company will also be able to utilize NFL’s official data feed as part of this agreement and will be able to amplify the NFL fan experience through NFL footage, highlights, and the Next Gen States content.
As an exclusive official daily fantasy partner for NFL, DKNG will have exclusive rights to NFL marks in order to promote daily fantasy sports contests. The company will also collaborate with NFL on a range of product and content offerings and DKNG will be integrated across media properties of NFL including within the NFL RedZone channel. (See DraftKings stock analysis on TipRanks)
Following the NFL deal announcement, Oppenheimer analyst Jed Kelly reiterated a Buy and a price target of $80 (39.2% upside) on the stock. Kelly commented on the deal, “The NFL became the last major US sports league to officially embrace online sports betting (OSB) by announcing DKNG, Caesers, and FanDuel as its first three official betting partners.”
“We see the development accelerating legalization and increasing consumer adoption, where the NFL will likely change its policy, and now allow gambling commercials during its broadcasts. Additionally, we believe this will benefit in-game wagering, where we now expect the league to work more closely with its media partners to reduce latency,” Kelly added.
Consensus among analysts is a Moderate Buy based on 16 Buys, 6 Holds, and 1 Sell. The average analyst price target stands at $72.77 and implies upside potential of 26.6% to current levels.
According to the TipRanks Smart Score system, DKNG scores a “Perfect 10” indicating that the stock is highly likely to outperform the market.