The opening bell of the 2023 National Football League (NFL) is set to ring this Thursday with a curtain-raiser between the Detroit Lions and the Super Bowl defending champions, the Kansas City Chiefs. With college football already in its second week of the season, an enticing blend of two of the most popular American sports could help invigorate select betting stocks in the marketplace.
Standing at the forefront of this financial expectation are FanDuel’s parent company, Flutter Entertainment, and DraftKings. As the two largest online sportsbook operators in the US, they are in line to maximize potential benefits of this football season’s surge in sports betting. Considering football has the highest stake in the sports betting arena, the season’s advent could bring some tangible, albeit potentially transient, benefits for betting stocks.
Historically, the advent of the NFL season heralds a rally for online gaming stocks, as recently indicated by a Bank of America report. Yet, gains attributed to the NFL may prove more durable than anticipated, considering the richness of the sporting calendar during the third and fourth quarters. For instance, both the NBA and NHL seasons are slated to commence next month, while college basketball is set to tip-off in November.
Further intensifying the prospect for sportsbook operators is Kentucky’s decision to join the arena of live and legal mobile sports betting this year.
The promising landscape has seen Flutter Entertainment and DraftKings identified as potential leaders among betting stocks, as per a Jefferies investment bank survey. A positive indication came through with 44% of participants admitting to placing a sports bet over the previous year, a considerable increase from 37% in January.
FanDuel and DraftKings, combined control approximately three-quarters of the US’s online sports betting market, and the results pointed towards a strong customer loyalty rate. A stimulus for the two firms, 89% of bettors have demonstrated a likelihood to continue wagering with their current accounts, exhibiting a six percent increase since January.
Another noteworthy trend saw the growing likelihood of bettors maintaining more than one sportsbook account, with 33% of respondents showing an intent to maintain a single account and 39% choosing to have two, both witnessing an increase from the previous survey. Furthermore, there’s been a notable increase in bettors intending to maintain three accounts, from 15% earlier to 20% in the recent survey.
Bullish statements from Needham analyst Bernie McTernan on DraftKings and sports wagering data provider Genius Sports also spotlighted these firms. Genius Sports, touted to benefit from bettors’ growing preference for in-game or live wagers, can count sportsbook operations and multiple major sports leagues, inclusive of the NFL, among their client base.