Street Calls of the Week
Investing.com - Jefferies has reiterated its Buy rating and $380.00 price target on Flutter Entertainment (NYSE:FLUT), a $49.8 billion market cap gaming company that has seen its shares surge nearly 28% over the past six months. The firm states that recent share weakness represents an "overreaction" to developments in the prediction market space. According to InvestingPro data, the company maintains a strong financial health score with robust revenue growth of 15.6% in the last twelve months.
The research firm specifically pointed to Monday’s launch of a new same-game parlay-style product by prediction market operator Kalshi for NFL matches, which allows users to combine pre-match legs on match outcomes, points, and touchdown scorers.
Jefferies noted that while prediction market operators have gained attention in recent months, they have typically lacked the product depth offered by online sports betting operators like Flutter.
The firm acknowledged that Kalshi’s new customizable product resembles the same-game parlay products offered by sportsbooks—which account for more than 70% of Flutter’s gross gaming revenue—but indicated the prediction market version comes with limiting features.
Prediction markets are expected to be a significant topic of discussion at the upcoming Global Gaming Expo (G2E) in Las Vegas next week, according to the research note.
In other recent news, Flutter Entertainment has been in the spotlight with Benchmark reiterating its Buy rating and setting a price target of $365, driven by strong performance from its FanDuel unit. FanDuel reported a 10% year-over-year growth in handle during NFL Week 3 in New York, with gross gaming revenue increasing by 24% compared to the same period last year. Additionally, Flutter Entertainment received a Market Outperform rating from Citizens JMP, with a price target of $345, amidst a robust prediction market news cycle.
Meanwhile, Caesars Entertainment has maintained its Market Outperform rating from JMP Securities, with a price target of $41. This comes after an analysis comparing odds and operator pricing across NFL Week 3 games. In partnership news, FanDuel and Delaware North have formed a new market access agreement for online sports betting and igaming in West Virginia through Delaware North’s Mardi Gras Casino & Resort. This partnership allows FanDuel to continue its operations in the state.
Lastly, Robinhood Markets reported strong September trading metrics, with approximately 187 million option contracts traded from September 1 through September 25. The company is also exploring the expansion of its prediction markets product internationally, engaging with regulators like the UK’s Financial Conduct Authority.
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