UBS raises Flutter Entertainment stock price target to $335

On Tuesday, UBS analysts showed optimism towards Flutter Entertainment (NYSE:FLUT), increasing the stock's price target from $320.00 to $335.00 while maintaining a Buy rating. The adjustment comes after a significant upgrade cycle in the company's US operations during the previous year. The company, currently valued at $46.7 billion, has demonstrated strong momentum with a 32% price return over the past six months. According to InvestingPro analysis, the stock is trading near its calculated Fair Value, with 12 additional exclusive insights available to subscribers.

Flutter Entertainment's US business, FanDuel, reported revenues of $6.35 billion and an adjusted EBITDA of $790 million for 2024. These figures exceeded the initial March 2024 guidance, which forecasted revenues of $6 billion and EBITDA of $710 million. The performance improvement was attributed to several factors including better cohort economics, higher customer acquisition volumes, and an expansion in structural gross win margins. The company's overall revenue growth reached nearly 20% in the last twelve months, with total revenue of $13.57 billion. InvestingPro data reveals that analysts expect the company to return to profitability this year, despite current challenges.

The UBS analyst underscored the success of these strategies, indicating that the positive trend could continue into 2025. The optimism is based on the belief that there is still potential for growth and momentum in the key areas that drove the upgrade cycle.

The raised price target reflects the analyst's confidence in Flutter Entertainment's ability to sustain its financial performance. The company's strong results in the US market, particularly with its FanDuel brand, have evidently played a pivotal role in the upgraded outlook.

Investors and stakeholders in Flutter Entertainment will likely monitor the company's progress closely, especially as the analyst suggests that the conditions are in place for continued success in the coming year. The new price target of $335.00 represents UBS's current valuation of the stock's potential.

In other recent news, Flutter Entertainment and DraftKings (NASDAQ:DKNG) are among the top gaming companies expected to benefit from the US market's competitive dynamics, according to insights from the ICE Barcelona conference. The companies are also set to generate substantial free cash flow, enabling international expansion through mergers and acquisitions. However, they face potential tax increases in Maryland, which could affect their operational costs. Stifel initiated Flutter with a Buy rating due to its attractive valuation and potential for positive catalysts.

Flutter Entertainment recently reported a significant $438 million hit to its Gross Gaming Revenue due to unfavorable NFL outcomes. This led to downward revisions in its 2024 US revenue projections and Adjusted EBITDA expectations. Despite these developments, Susquehanna maintained a positive rating on Flutter but reduced its price target from $322.00 to $317.00. Benchmark analysts also maintained a Buy rating.

These are the recent developments for Flutter Entertainment and DraftKings, serving as a snapshot of the companies' current situations. All information presented is based on available facts and does not include personal opinions or predictions.

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