Flutter Entertainment Shares Up 5% as Analysts Remain Optimistic

Renowned betting and gaming operator Flutter Entertainment experienced a significant surge in its share value. Despite increased competition, the company’s FanDuel brand has maintained its leadership position in the USA, and its overseas investments also pay significant dividends. This development aligns with Flutter’s plans to enter the New York Stock Exchange after it stops trading its ordinary shares on Euronext Dublin by 23 January.

The US Market Presents Significant Opportunities

The notable 5% share price increase is primarily due to Peel Hunt’s favorable opinion on the company’s prospects, centering around its FanDuel brand. The investment firm projects Flutter’s US business to generate an adjusted EBITDA of $180 million for the full year of 2023. The following year should allow the gambling giant to cement its positions in established jurisdictions, doubling down on profitable markets.

Peel Hunt’s forecast for Flutter aligns with the company’s November guidance, predicting an adjusted EBITDA of approximately £1.44 billion ($1.83 billion), excluding the US market, and revenue of £3.75 billion ($4.77 billion) from the US. Despite this stellar performance, Flutter’s shares declined over 10% in the last six months, driven by regulatory uncertainties in the UK and Australia.

These developments highlight Flutter’s increasing reliance on the US market, which saw a significant expansion in 2023 and should remain the company’s most important revenue driver. Sisal is another promising Flutter subsidiary, as its lottery business was a standout performer within the company’s international division, successfully tapping into growth markets.

Overseas Operations Remain Vital

Flutter Entertainment is preparing for a dual listing of its shares on the New York Stock Exchange starting 29 January 2024, contingent upon regulatory approvals. This move aligns with the company’s strategy as it revealed that over 30% of its Q3 2023 revenue stemmed from the burgeoning US market.

Conversely, the gambling giant’s imminent exit from the Dublin Stock Exchange should streamline its operations and minimize regulatory complexities. Flutter’s ordinary shares will stop trading on Euronext Dublin on 23 January 2024. However, the company will keep its listing on the London Stock Exchange, highlighting its substantial regional investments.

Analysts believe that favorable industry trends can further propel Flutter’s shares as it draws renewed interest from US investors. The company’s diverse, globe-spanning portfolio enables it to capitalize on new developments, delivering long-term and sustainable growth. While 2024 will undoubtedly present significant challenges for the broader industry, Flutter remains well-equipped to capitalize on its strengths.