Bullish indicating open at $55-$60, IPO prices at $37
On Thursday, MoffettNathanson maintained a positive outlook on Flutter Entertainment (NYSE:FLUT), increasing the stock's price target from $245.00 to $275.00 while keeping a Buy rating. The firm's decision is rooted in a renewed confidence in the company's growth potential, especially outside the United States.
The analyst at MoffettNathanson justified the new price target by applying a consistent 12.0x EV/EBITDA multiple on the projected 2030 Flutter U.S. GAAP EBITDA, similar to their valuation of DraftKings (NASDAQ:DKNG).
This approach is then discounted back to the year 2025. Additionally, the 2025E EV/EBITDA multiple for Flutter's operations outside the U.S. has been increased from 5.0x to 7.0x, reflecting a more optimistic view of the company's growth trajectory.
This revised valuation results in an estimated enterprise value of $55 billion and an equity value of $49.5 billion for Flutter Entertainment. The analyst's report included a detailed exhibit to support these figures, although it was noted that the firm's model has not been updated to include findings from yesterday's Investor Day.
The report emphasizes that even with the increased price target, the valuation remains conservative. The adjustment in the price target is a response to the positive indicators of Flutter Entertainment's performance and potential, particularly in markets outside the U.S.
MoffettNathanson's updated valuation comes after a detailed evaluation of the company's prospects and recent developments. The firm's stance on Flutter Entertainment remains bullish, as evidenced by the maintained Buy rating and raised price target.
In other recent news, Flutter Entertainment reported a 20% increase in Q2 revenue to $3,611 million and a 17% rise in adjusted EBITDA to £738 million. The company also confirmed its acquisition of Snaitech S.p.A., an Italian gaming operator, for approximately €2.3 billion ($2.53 billion), anticipated to conclude in Q2 2025. Analysts from BTIG, Barclays, and Morgan Stanley maintain positive ratings for Flutter Entertainment, with BTIG and Barclays setting price targets of $249.00 and $263.00 respectively.
Analysts suggest that Flutter's Italian operations could potentially double in size over the next four to five years, based on consistent market growth and shifts in market dynamics. This projection is influenced by Flutter's recent acquisition of Snaitech and the potential for the company to expand its market presence in Europe.
In compliance with regulatory requirements, Flutter Entertainment continues to disclose information through the Regulatory News Service and the U.S. Securities and Exchange Commission. The company also announced plans to host an Investor Day event.
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