Barclays has sustained its confident outlook on shares of Flutter Entertainment (NYSE: FLUT), maintaining an Overweight rating and a $263.00 price target.
The firm's stance comes with a positive view of the company's recent acquisition, particularly given the characteristics of the Italian market.
The market analyst from Barclays highlighted the considerable total addressable market (TAM) in Italy, which stands at €21 billion, with only a 21% online penetration rate.
The firm noted that omni-channel operators like Snaitech are well-positioned to capitalize on this market, having demonstrated a robust growth in EBITDA with a compound annual growth rate (CAGR) of 32% over the four years leading to 2023.
Snaitech, with its significant online presence accounting for half of its mix, is expected to benefit from the continued growth projected for Italy's digital market, which H2GC estimates to expand at a 12% CAGR from 2023 to 2028.
The complete advertising ban in Italy has created significant hurdles for new entrants, thus advantaging established omni-channel entities that combine digital and retail operations. Snaitech, which operates around 2,000 retail sites and holds a mid-teens retail market share, ranking second in the sector, is seen as particularly well-placed in this environment.
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