DraftKings acquires Railbird to enter prediction markets space

BOSTON - DraftKings Inc. (NASDAQ:DKNG), the $16.7 billion market cap gaming company with impressive revenue growth of 25.8% over the last twelve months, announced Tuesday the acquisition of Railbird Technologies Inc. and its federally licensed exchange subsidiary, expanding its business into prediction markets. According to InvestingPro analysis, the company appears undervalued based on its Fair Value estimates.

The acquisition enables DraftKings to offer regulated event contracts on outcomes across finance, culture, and entertainment through a new mobile application called DraftKings Predictions, expected to launch in the coming months.

"We are excited about the additional opportunity that prediction markets could represent for our business," said Jason Robins, CEO and Co-Founder of DraftKings.

The company stated the new platform will connect to multiple exchanges, allowing it to offer a broad suite of markets to customers, with potential expansion into additional categories over time.

Miles Saffran, CEO and Co-Founder of Railbird, called the acquisition "a transformational moment" for his company.

DraftKings’ new prediction markets venture represents an expansion beyond its current offerings in daily fantasy sports, available in 44 states and parts of Canada, and sports betting operations in 28 states, Washington D.C., and Ontario.

The Boston-based company, founded in 2012, also operates iGaming in five states and Ontario under its DraftKings brand and in four states and Ontario under its Golden Nugget Online Gaming brand.

Sullivan & Cromwell LLP served as legal counsel to DraftKings for the transaction, while Moelis & Company LLC acted as financial advisor to Railbird, with Proskauer Rose LLP and Kirkland & Ellis LLP serving as legal counsel.

This article is based on a press release statement from DraftKings. The company’s next earnings report is scheduled for October 31, 2025, with analysts maintaining a bullish consensus recommendation despite recent stock price volatility.

In other recent news, DraftKings has announced its acquisition of Railbird, a predictions platform, as it gears up to launch a new mobile platform called DraftKings Predictions. This move aims to leverage Railbird’s team and proprietary technology, which is licensed by the Commodity Futures Trading Commission. In a separate development, Berenberg has upgraded DraftKings’ stock rating from Hold to Buy, citing solid growth and margin improvements despite some downward adjustments due to sports results. Meanwhile, Mizuho has lowered its price target for DraftKings to $54, maintaining an Outperform rating, while Jefferies has reduced its price target to $51, citing unfavorable third-quarter trends and promotional spending challenges. Additionally, DraftKings has alerted its customers to account breaches resulting from credential stuffing attacks. The company discovered the security incident in early September and has been investigating the unauthorized access to customer accounts.

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