Texas Roadhouse earnings missed by $0.05, revenue topped estimates
On Thursday, Stifel analysts maintained their Buy rating and $315.00 price target for Flutter Entertainment (NYSE:FLUT), a $42.1 billion market cap gaming company with annual revenues of $14 billion, despite the company’s first-quarter adjusted EBITDA falling short by 8%. According to InvestingPro data, Flutter maintains a healthy 47.7% gross profit margin and has demonstrated strong revenue growth of 19.2% over the last twelve months. The shortfall was attributed to more significant adverse effects from unpredictable sports results and inaccuracies in modeling international seasonality. However, Flutter’s FY25 guidance was revised upward, factoring in contributions from Snaitech/NSX and favorable foreign exchange movements, offsetting the negative sports outcomes. The core guidance remains unchanged. InvestingPro analysis indicates the company is currently trading above its Fair Value, with analysts projecting significant earnings growth to $8.73 per share in FY2025.
The management team at Flutter highlighted that the recent slowdown in market-wide handle growth in the U.S. could be explained by an expansion in structural hold, which might alleviate concerns about market maturation or economic pullbacks. However, they noted a softer trading environment for NBA games. Stifel analysts believe that the FY25 guidance has room for positive adjustments, driven by user acquisition and structural hold momentum in the U.S. They also anticipate that accelerating top-line synergies could lead to outperformance and upward revisions in FY26/27 estimates.
Reflecting on the company’s valuation, Stifel pointed out that Flutter Entertainment is trading at a moderate single-digit percentage 2026E free cash flow yield, which supports their multi-year Buy thesis. InvestingPro data reveals the company’s strong financial health with an overall score of 2.73 (GOOD), though it currently trades at relatively high multiples with a P/E ratio of 989.4 and EV/EBITDA of 24.3. For deeper insights into Flutter’s valuation metrics and growth potential, investors can access the comprehensive Pro Research Report, available exclusively to InvestingPro subscribers. Adjustments were made to the FY25/26 adjusted EBITDA estimates, decreasing by 1% for FY25 and increasing by 1% for FY26, primarily due to changes in foreign exchange rates and the adverse outcomes experienced.
The Stifel analysts concluded that despite the adjustments, the price target for Flutter Entertainment remains at $315.00, signaling confidence in the company’s long-term growth prospects and financial performance.
In other recent news, Flutter Entertainment has reported its first-quarter 2025 earnings, which fell short of analysts’ expectations. The company posted an earnings per share (EPS) of $1.59, missing the forecasted $2.05, and revenue of $3.67 billion, below the expected $3.96 billion. Despite the shortfall, Flutter Entertainment saw an 18% year-over-year revenue growth in its U.S. segment. JMP Securities maintained their Market Outperform rating for Flutter, with a price target of $317, noting mixed financial results compared to projections. They highlighted that U.S. revenue and EBITDA showed slight growth, while international revenue was on target. Additionally, Flutter Entertainment announced a share repurchase program, aiming to enhance shareholder value, though specific financial details of the buyback were not disclosed. The company also completed strategic acquisitions in Italy and Brazil, expanding its market presence. These developments come as Flutter continues to navigate financial variances and regulatory environments in its key markets.
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