DraftKings starts the NFL season strong despite the Buffalo Bills' margin-wrecking week 1 comeback

[The National Football League West Coast Office in Inglewood, CA.]

DraftKings (NASDAQ:DKNG [https://seekingalpha.com/symbol/DKNG]) suffered its worst single-game outcome in its history during week one of the NFL season, according to Citizens Equity Research Analyst Jordan Bender.

The sports betting operator was hit by multiple player props hitting during the Buffalo Bills-Baltimore Ravens game and bettors piling into the Bills moneyline before the game and during the contest when the team was down late by as much as 15 points. Volume on the high-profile game made the results especially critical to DraftKings' (NASDAQ:DKNG [https://seekingalpha.com/symbol/DKNG]) hold rate.

However, Bender noted that, excluding the Bills comeback game, the first two weeks of NFL action have been in line with DraftKings' (DKNG [https://seekingalpha.com/symbol/DKNG]) high expectations in terms of both betting volume and hold rate.

On the positive side, DraftKings (DKNG [https://seekingalpha.com/symbol/DKNG]) has also outpaced FanDuel (FLUT [https://seekingalpha.com/symbol/FLUT]) so far this NFL season in terms of app downloads. Netflix's (NFLX [https://seekingalpha.com/symbol/NFLX]) streaming of the Canelo Alvarez–Terence Crawford fight is seen as likely boosting downloads across the industry.

Investors have been eyeing the early hold rates for online sports betting operators after a disappointing NFL season last year when "customer-friendly" game outcomes dented earnings. Notably, NFL favorites won at their highest level in two decades for the 2024 NFL season, which tends to favor the betting public.

Taking the long view, Jefferies analyst David Katz said that while the first two weeks of the NFL season could have gone a little better for the books overall, the firm noted that week two of 2024 was exceptionally strong, and quarter-to-date trends remain favorable for FanDuel (FLUT [https://seekingalpha.com/symbol/FLUT]), DraftKings (DKNG [https://seekingalpha.com/symbol/DKNG]), BetMGM (MGM [https://seekingalpha.com/symbol/MGM]) (OTCPK:GMVHF [https://seekingalpha.com/symbol/GMVHF]), and Rush Street Interactive (RSI [https://seekingalpha.com/symbol/RSI]).

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