Flutter Has Recession Insulation, Multiple Tailwinds, Says Analyst
Posted on: July 7, 2025, 08:04h.
Last updated on: July 7, 2025, 08:04h.
- FanDuel parent draws praise from Jefferies in new coverage
- Analyst says Flutter has recession buffers, tailwinds justifying Wall-Street high price target of $380
Shares of Flutter Entertainment (NYSE: FLUT) are up 9.44% year-to-date — an impressive feat considering the headwinds encountered by another sports wagering tax increase in Illinois.
At least one analyst sees much more upside ahead for the FanDuel parent. In resuming coverage of the gaming stock, Jefferies analyst James Wheatcroft rates Flutter a “buy” with a Wall Street-high price target of $380, implying upside of approximately 35% from today’s close. One of the reasons for the analyst’s bullishness on the stock is recession resilience.
Our recent in-depth Recession Scenario note flagged the lack of historical correlation between online gambling and the macro backdrop. FLUT’s high online exposure (91% revenues), high geographic diversity (59% revenues outside main market), and solid balance sheet (2.2x leverage, with ongoing buyback) add insulation,” wrote Wheatcroft in a note released after the close of US markets today.
The analyst adds that recent lethargy in Flutter’s US handle growth is more the result of the operator reducing promotional spending and an evolving product lineup than it is the byproduct of weakness in the broader economy.
Flutter International Exposure Could Boost Stock
To American bettors and many investors in this country, Flutter is known as the owner of FanDuel. That is accurate and importance of the US to the operator’s investment thesis is highlighted by a recently implemented reporting structure in which the company breaks out international and domestic results separately.
Still, Flutter’s international exposure cannot be ignored and it represents a potential advantage over some competitors, such as DraftKings (NASDAQ: DKNG), which operate solely in North America. Wheatcroft notes market participants may not be fully appreciating the ex-US opportunity set offered by Flutter.
“Despite 1Q25 headlines suggesting International market share losses, we see encouraging underlying dynamics in several markets (UK&I, Italy, Australia, Brazil), with further runway for share gains supported by regulatory change and mergers and acquisitions,” observes the analysts.
Speaking of international acquisitions, Flutter has been effective on that front, adding a majority stake in Brazil’s NSX Group and purchasing of Italy’s Snai — deals that add exposure in two of the world’s premier gaming markets outside the US.
Flutter Stock Valuation Isn’t Demanding
Among the other tailwinds possessed by Flutter are the often discussed possibility of the stock being included in the S&P 500 and the company’s share repurchase program, which could amount to as much as $1 billion this year. Even when accounting for that buyback activity, Flutter could return as much as 60% of its current market capitalization to investors by 2030, according to Wheatcroft.
The analyst notes Flutter’s free cash flow yield could reach 5% by the end of next year before doubling to 10% by the end of 2030 and when accounting for the stock’s positive attributes, it’s not stretched on valuation.
“Valuing the US at a 20% premium to DraftKings and International in line with S&P 500 consumer discretionary peers implies a $350 sum-of-the-parts price,” concludes Wheatcroft. “Or another way, a 20% premium to DraftKings implies International trades on 10x EV/EBITDA vs 13.5x historically. Our new Street-high $380 price target is DCF-based to reflect the long-term US opportunity.”
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