Prediction markets will be an asset for DraftKings and Flutter, says Needham's Bernie McTernan

Watch on YouTube ↗  |  January 23, 2026 at 20:36  |  3:44  |  CNBC
Speakers
Bernie McTernan — Senior Analyst, Needham

Summary

Needham senior analyst Bernie McTernan discusses sports betting and prediction markets on Power Lunch. He argues prediction markets are an asset rather than a threat to DraftKings and Flutter, citing a larger TAM and planned investments, and expects nationwide access to create a catalyst for more states to legalize sports betting. He also highlights integrity-service providers and a near-term preference for prediction-market free riders, though the transcript cuts off before those names are fully stated.

  • Bernie McTernan of Needham says prediction markets should benefit DraftKings and Flutter.
  • He sees prediction-market TAM exceeding online sports betting due non-sports, unregulated-state, and 18-to-20-year-old users.
  • Flutter plans $250 million of prediction-market investment in 2026; DraftKings may invest an incremental $200 million.
  • He expects nationwide prediction-market access to push more states to legalize sports betting for tax revenue.
  • He says online sports betting still offers a better sports product in regulated markets.
  • He prefers near-term prediction-market free riders, but the transcript ends before naming them.
  • Sportradar and Genius Sports are mentioned in the context of integrity services and game-fixing oversight.
Ideas
Bernie McTernan Senior Analyst, Needham 0:31
Prediction markets benefit DraftKings and Flutter
McTernan argues prediction markets should be viewed as an asset rather than a threat to DraftKings and Flutter. Although he still thinks online sports betting offers a better sports product in regulated markets, the non-sports prediction-market opportunity is substantial and the prediction-market TAM is larger than online sports betting because it can reach the unregulated half of the country, 18-to-20-year-olds, and non-sports users not directly competed for by DraftKings/FanDuel. Flutter plans to invest $250 million in prediction markets in 2026 and DraftKings may invest an incremental $200 million, with ROI on those investments the key debate.
DKNG FLUTTER HIGH
Bernie McTernan Senior Analyst, Needham 3:27
States may legalize sports for tax revenue
McTernan says sports betting/investing in sports is already legal nationwide via prediction markets, so state legislators can no longer keep constituents from betting. Legalization therefore becomes a question of whether states want the tax revenue. He expects this to be a catalyst for more states to legalize sports, supporting online sports betting.
BETZ MED
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This CNBC video, published January 23, 2026, features Bernie McTernan discussing DKNG, FLUTTER, BETZ. 2 trade ideas extracted by AI with direction and confidence scoring.

Speakers: Bernie McTernan  · Tickers: DKNG, FLUTTER, BETZ