Published on: October 1, 2025, 01:46h.
Updated on: October 1, 2025, 02:11h.
- Analyst downgrades DraftKings and Flutter profit forecasts to industry lows
- NFL results, rather than prediction markets, identified as cause for revisions
The stock of DraftKings (NASDAQ: DKNG) and Flutter Entertainment (NYSE: FLUT) has seen significant fluctuations lately, predominantly due to the surge in activity in prediction markets and various exchanges providing same-game football parlays.
The underlying issue seems to be another set of player-friendly results in NFL games. With NFL betting in play, September typically represents half of the operators’ third-quarter volume, and now that this period has concluded, evidence suggests that DraftKings and Flutter’s earnings before interest, taxes, depreciation, and amortization (EBITDA) may take a hit.
“We estimate that FanDuel faced an approx. $130 million EBITDA burden during this month, leading to a total U.S. EBITDA of +$44 million for the quarter (U.S. forecast +$143 million),” states Citizens Equity Research Analyst Jordan Bender. “DraftKings is expected to endure a slightly worse impact (projected gaming margins vs. actual), given that negative sports results coincided with aggressive promotions and customer acquisition efforts, leading to a ~$200 million EBITDA burden during the month, resulting in an overall EBITDA loss of -$102 million for the quarter (consensus +$51 million).”
Bender has cut his 2025 EBITDA projection for DraftKings to $705.3 million from $871.6 million and adjusted his 2026 prediction for the company to $1.29 billion from $1.30 billion. For Flutter, the owner of FanDuel, Bender reduced his 2025 EBITDA forecast to $3.18 billion from $3.32 billion and lowered the next year’s estimate to $4.30 billion from $4.37 billion.
DraftKings and Flutter May Face More NFL Uncertainty
In the past week, shares of DraftKings and Flutter have dropped by 16% and 8.82%, respectively, indicating that NFL weekends have not been lucrative for these gaming firms.
This downturn has pushed both stocks below their 200-day moving averages—a bearish trend that might attract short-selling activities. Even if this doesn’t happen, the remainder of the 2025 NFL season may yield more challenges than benefits for DraftKings and Flutter.
“The outlook from here could be turbulent if gaming margins remain unstable, leading to further estimate reductions throughout the NFL season,” Bender adds. “However, a diverse player prop mix might generate some positive momentum for these companies during successful weeks, though we have seen minimal evidence in recent NFL seasons suggesting this.”
Bender maintains “market outperform” ratings for both stocks but has lowered his DraftKings price target from $54 to $51, while reducing Flutter’s price target from $345 to $340.
A Glimmer of Hope for DraftKings and Flutter
Investors searching for something positive amid the declining stock prices of DraftKings and Flutter might see an opportunity if the companies decide to repurchase shares, as both have buyback programs available.
“Without any significant risks emerging from prediction markets, we anticipate that these companies’ shares will stabilize as they engage in stock buybacks, given that online gaming stocks plummeted 17% (FLUT) and 22% (DKNG) in September, in contrast to the Russell 3000’s +3% growth,” Bender notes.
The analyst concluded that while DraftKings and Flutter are trading at discounts relative to their long-term potential, it is crucial for the operators to articulate clear strategies in the upcoming months. Otherwise, their stocks may remain susceptible to positive developments arising from prediction market trends.