Survey bodes well for sports betting, Jefferies analyst says
Proposition bets are on the rise. That is one of the findings of a Jefferies Equity Research survey of sports bettors, released 11 June.
Writing for Jefferies, analyst David Katz said, “the key take is that in-play appears to be growing [in] popularity, which should be positive for handle growth in general.” It also boded well for DraftKings and Sportradar, the former because it focuses on in-play bets, the latter for its business-to-business ramifications.
Katz also noted a continued interest in parlay wagers. This trended well for FanDuel and parent Flutter Entertainment, which emphasize parlays in their wagering offerings.
Jeffries queried punters on proposition bets and found that “average handle per player has barbelled over our past three surveys, whereby lower bet players and higher bet players have expanded.” Eighty percent of bettors surveyed said they had tried proposition bets, while 90 % said they were “engaged with in-play activities.”
With regard to parlays, 60% of respondents favored single- and multi-game wagers. Fifteen percent said they were primarily proposition bettors.
“We attempted to define an in-play betting [total addressable market] by capturing players’ engagement through actions within the game/match/event such as checking odds progression, indicating appetite for more bets and/or cash-out opportunities,” Katz reported. He found that these respondents comprised 90% or more of the survey sample.
Although 80% of those surveyed said they had placed proposition bets, 90% said they wanted more prop-bet offerings. The chance to place in-play wagers was “slightly” important to 92%, while more than 95% said “that they either checked odds in-game or considered placing a bet/taking a cash-out offer in-game.
“Ultimately, we believe that the prospects for in-play as a handle driver over time is supported by our results,” summarized Katz.
Survey respondents were 54% male, a surprise to Jeffries and one “which skews more female than consensus expectations.” Basketball and football had been bet upon by 24% of those queried, with 15% wagering on baseball. Historically, football had been wagered on by 40% of those surveyed.
The popularity of DraftKings was “surprisingly high,” favored by 32% compared to 20% for FanDuel. When polled in October 2024, bettors liked DraftKings over FanDuel by a much closer margin, 56% and 48%, “which could be an anomaly given market share trends.”
Among bettors, 52 preferred to bet alone, while 48 percent did it sporadically or as a social activity, “which is surprising given our prior survey indicating more social engagement.”
The survey findings validated, Katz wrote, his bullishness toward DraftKings. “We believe that the OSB names in general, and DraftKings specifically, have taken several hits as of late (i.e., unfavorable sports outcomes, higher tax rates, a lack of new state legalizations, and the rise of prediction markets),” he penned. “However, we believe that the structural growth in the industry can’t be matched elsewhere” in gaming or leisure industries.
The popularity of in-play wagers, Katz continued, could give the business a leg up on growing handle volume, whether additional states legalize sports betting or not. DraftKings, he added, “is likely to be the leader in in-play due to its acquisition of SimpleBet and focus on the vertical.”
Jeffries surveyed 768 US residents. They fell between the ages of 18 and 44, and used smartphones daily. Of that group, 259 had not previously bet on sports and thus were excluded from the remainder of the questioning.
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David McKee is an award-winning journalist who has three decades of experience covering the gaming industry.
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