DraftKings boosted by in-play betting, analyst says

David McKee

9 September 2025 at 5:08pm UTC-4

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Jefferies Equity Research analyst David Katz perceived “strengthening trends around in-play betting,” or proposition bets, which he called a positive for DraftKings in particular. He expressed this view in a 9 September investor note.

Also benefiting from a prop-bet surge, Katz continued, would be infrastructure provider Sportradar. Not to be forgotten, DraftKings’ arch rival, Flutter Entertainment – corporate parent of FanDuel – would enjoy a lift from the continuing popularity of parlay wagers.

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In-play wagers were surging with bettors, Katz found, noting a 10% sequential increase in player interest since the first quarter. Meanwhile, 54% of punters surveyed had placed single-game parlay bets while 43% had tried multi-game parlays.

Katz reassured investors that prediction markets were showing “further evidence of its capped economic ceiling” compared to online sports betting. Event contracts had achieved 60% market penetration in the United States.

Jefferies’ research, meanwhile, had shown 84% of bettors placing prop wagers, whether on in-game events or the outcome of the match itself. “Furthermore, players are putting more of an emphasis on these types of bets, with 44% of respondents noting that in-play betting availability was “very important” to them (up 9pts vs. June),” Katz wrote.

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Prop bets were making converts, with much of the curiosity stemming from players who had rated in-players are of slight importance or none as recently as June of this year. Fully 25% of players who had been previously uninterested in prop wagers had changed their mind.

Ninety-two percent of all players expressed the view that their game-watching experience would be better if more propositions were offered. Half of all bettors surveyed indicated it would be a great improvement, while 42% felt it would increase their experience “a little.”

Football was favored by 70% of respondents and basketball was a top sport with 62%, with no clear third choice emerging. Four out of every 10 respondents were women, “which we believe may be an under-appreciated demographic of bettors, with specific preferences that differ from men.”

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Good news for BetMGM and Fanatics was that they logged “significant support.” Caesars Sportsbook and ESPN Bet were described as consumer-choice laggards.

Almost half of all bettors (49%) predicted their wagers would be about the same going forward, down from 54% in June. Those who intended to bet more surged from 32% three months back to 41% now.

Katz enumerated the blows online sports betting had taken, including the rise of event contracts, adverse game results, higher taxes and stagnation at the state level in terms of wagering’s spread. However, he noted that the industry had “fully priced in” such adversities.

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The analyst said he was bullish on DraftKings because of the potency of its prop-wager products.

“Finally, we still see in-play betting as a new leg higher in handle, regardless of new state legalizations, and believe that DKNG is likely to be the leader in in-play due to its acquisition of SimpleBet and focus on the vertical,” Katz concluded.