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1. Company Snapshot

1.a. Company Description

Flutter Entertainment plc operates as a sports betting and gaming company in the United Kingdom, Ireland, Australia, the United States, and internationally.The company operates through four segments: UK & Ireland, Australia, International, and US.It offers sportsbooks and exchange sports betting products, daily fantasy sports products, and pari-mutuel betting products; fixed odds games betting products; online games and casinos; peer-to-peer games, including online bingo, rummy, and poker; and business-to-business services.


The company also operates HRTV, a horseracing television network, as well as offers treasury; risk management; and horse racing broadcasting and advanced deposit wagering services.It provides sports betting and gaming services through paddypower.com, betfair.com, sportsbet.com.au, tvg.com, us.betfair.com, fanduel.com, pokerstars.com, Skybet.com, tombola.com, and adjarabet.com websites under the Paddy Power, Betfair, Sportsbet, TVG, FanDuel, Sky Betting & Gaming, PokerStars, Tombola, and Adjarabet brands, as well as BetStars, Sky Bet, Sky Vegas, FOX Bet, Stardust, Sky Bingo, and Junglee Games brands; and betting shops, and live poker tours and events.The company was formerly known as Paddy Power Betfair plc and changed its name to Flutter Entertainment plc in May 2019.


Flutter Entertainment plc was incorporated in 1958 and is headquartered in Dublin, Ireland.

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1.b. Last Insights on FLTR

Flutter Entertainment's recent performance has been impacted by several negative factors. The company's Q3 earnings report revealed a significant net loss of $690 million, driven by non-cash charges, despite robust revenue growth. This loss, along with a lower full-year outlook, has raised concerns about the company's profitability and growth strategy. Furthermore, the company has faced increased competition from new market entrants, such as Kalshi, which has launched a product that has dampened investor sentiment. Additionally, Flutter's updated annual revenue guidance and increased investment in sports and prediction markets have contributed to the negative sentiment.

1.c. Company Highlights

2. Flutter Entertainment Delivers Strong Q4 Performance Amidst Growth and Strategic Initiatives

Flutter Entertainment reported robust financial performance in Q4 2024, with revenue growing 14% year-over-year to $7.72 billion, driven by strong contributions from both its U.S. and international operations. Adjusted EBITDA rose 4% to $1.4 billion, reflecting operational leverage and continued cost discipline. Notably, adjusted EPS surged 67% to $0.95, underpinned by strong profitability and share buybacks. The company also highlighted a significant reduction in net debt, down $635 million, bringing leverage to 2.2x, which has enabled a $1 billion share repurchase program for 2025.

Publication Date: Mar -07

📋 Highlights
  • Strong U.S. Leadership and Market Share: Flutter solidified its position as the number 1 operator in the U.S., with a 43% sportsbook GGR share and 26% iGaming share in Q4. FanDuel's expansion into new states like North Carolina and Vermont, combined with innovative products such as Same Game Parlay, drove strong engagement and margins despite adverse sports results.
  • Adverse Sports Results Impact: Customer-friendly sports outcomes negatively impacted revenue by $550 million and adjusted EBITDA by $360 million in Q4. However, the company's pricing capabilities and product innovation helped mitigate some of these effects, demonstrating resilience in challenging conditions.
  • Robust Financial Performance and Cash Flow: Q4 revenue and adjusted EBITDA grew 14% and 4%, respectively, with net income reaching $156 million and adjusted EPS up 67%. Free cash flow surged 175%, and net debt reduced by $635 million, lowering leverage to 2.2x and enabling a $1 billion share repurchase program for 2025.
  • International Growth and Expansion: International revenue grew 14% in Q4, driven by strong performances in the UK, Italy, and India. Flutter is also pursuing growth opportunities in Latin America, including the NSX acquisition in Brazil, though it expects $100 million in EBITDA losses for 2025 as part of its regional expansion strategy.
  • Customer Acquisition and Product Innovation: Flutter saw strong customer acquisition trends, particularly in iGaming, driven by innovations like the FanDuel Casino Rewards Club and jackpot features. The company also highlighted the success of its "Your Way" product, which saw 1 in 20 customers placing unique bets during the Super Bowl, showcasing its focus on customer engagement and personalized betting experiences.

U.S. Leadership and International Momentum

The U.S. remained a cornerstone of Flutter's growth, with FanDuel solidifying its market leadership. The sportsbook captured a 43% GGR share, while iGaming reached a 26% share, driven by innovative products like Same Game Parlay and exclusive content. Despite adverse sports results, which impacted revenue by $550 million and adjusted EBITDA by $360 million, the U.S. segment still delivered 14% revenue growth and $163 million in adjusted EBITDA. Internationally, revenue grew 14%, with standout performances in the UK, Italy, and India, underscoring the diversity of Flutter's portfolio.

Strategic Initiatives and Future Outlook

Flutter emphasized its commitment to strategic growth through acquisitions and product innovation. The planned $1 billion share repurchase program highlights confidence in its cash generation and balance sheet strength. Management also outlined a clear path for 2025, with U.S. revenue and adjusted EBITDA guidance midpoints of $7.72 billion and $1.4 billion, respectively. Internationally, the midpoint for revenue and adjusted EBITDA stands at $8.25 billion and $1.85 billion, reflecting expectations of sustained growth across key markets. Cost savings initiatives are on track to deliver $300 million by 2027, further enhancing margins.

Valuation Analysis

At current trading levels, Flutter's valuation reflects its growth prospects, with a price-to-earnings ratio of 480.33 and an enterprise value-to-EBITDA ratio of 30.03, indicating high expectations for future profitability. The free cash flow yield of 2.13% underscores the company's ability to generate cash, supporting its shareholder return initiatives. While the valuation appears stretched, the company's strong execution and market leadership justify the premium. As CEO Peter Jackson noted, "We are well-positioned for 2025, with planned acquisitions, share repurchases, and continued product innovation," reinforcing confidence in Flutter's strategic direction.

3. NewsRoom

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FTSE 100 Live: Blue-chip index flat; banks and builders on the march

Nov -27

Source: proactiveinvestors.com

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Gambling tax rise puts a chill on Flutter and Entain

Nov -27

Source: proactiveinvestors.com

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FTSE 100 Live: London index dragged down by ex-divs and tobacco stocks

Nov -27

Source: proactiveinvestors.com

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FTSE 100 Live: London index dragged down by ex-divs, bookies Budget warnings

Nov -27

Source: proactiveinvestors.com

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Flutter Response to Tax Changes within UK Budget

Nov -26

Source: globenewswire.com

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Polymarket Is Cleared to Offer Prediction Markets as U.S. Regulator Remains Quiet on Sports Betting

Nov -26

Source:

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Flutter Entertainment (NYSE:FLUT): Assessing Value After Q3 Results, New Guidance, and Buyback Completion

Nov -26

Source:

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Wells Fargo Rolls the Dice on These 2 ‘Strong Buy’ Online Sports Betting Stocks

Nov -25

Source:

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (10.65%)

6. Segments

US

Expected Growth: 10.5%

Flutter Entertainment's US growth of 10.5% is driven by increasing online sports betting and iGaming adoption, strong brand presence, and strategic partnerships. The company's expansion in regulated US markets, particularly in Pennsylvania and Michigan, has contributed to revenue growth, while its investment in technology and marketing has enhanced customer engagement and acquisition.

UK&I

Expected Growth: 8.2%

Flutter Entertainment's UK&I segment growth of 8.2% is driven by increased online betting and gaming activity, strong customer acquisition, and effective marketing strategies. The company's sportsbook and gaming products have seen significant uptake, with a growing presence in the UK and Ireland. Operational efficiencies and a stable regulatory environment have also contributed to the segment's growth.

International

Expected Growth: 14.1%

Flutter Entertainment's international segment growth of 14.1% is driven by increased online betting and gaming activity, expansion into new markets, and strategic partnerships. Strong performances in Australia, Italy, and Turkey contribute to growth, alongside investments in technology and marketing initiatives to enhance customer engagement and acquisition.

Australia

Expected Growth: 9.5%

Flutter Entertainment plc's 9.5% growth in Australia is driven by increasing online gaming penetration, favorable regulatory environment, and effective marketing strategies. The company's strong brand portfolio and popular products, such as Sportsbet, have enabled it to capitalize on the growing demand for online betting and gaming in the region.

7. Detailed Products

Sports Betting

Flutter Entertainment plc offers sports betting services through its various brands, allowing customers to place bets on various sports and events.

Gaming

The company provides online gaming services, including casino, poker, and bingo, through its brands such as Betfair and Paddy Power.

Poker

Flutter Entertainment plc offers online poker services through its brands, allowing customers to play against other players.

Bingo

The company provides online bingo services through its brands, offering various bingo games and promotions.

Daily Fantasy Sports

Flutter Entertainment plc offers daily fantasy sports services through its brands, allowing customers to create fantasy teams and compete against others.

Racing

The company provides online horse and greyhound racing services through its brands, allowing customers to place bets on races.

8. Flutter Entertainment plc's Porter Forces

Forces Ranking

Threat Of Substitutes

Flutter Entertainment plc operates in a highly competitive industry, and customers have various alternatives to choose from. However, the company's strong brand portfolio and diversified product offerings mitigate the threat of substitutes to some extent.

Bargaining Power Of Customers

Flutter Entertainment plc's customers have limited bargaining power due to the company's strong market position and diversified product offerings. Additionally, the company's focus on customer retention and loyalty programs helps to reduce customer bargaining power.

Bargaining Power Of Suppliers

Flutter Entertainment plc has a diversified supplier base, which reduces the bargaining power of individual suppliers. The company's strong financial position and long-term contracts with suppliers also mitigate the bargaining power of suppliers.

Threat Of New Entrants

The online gaming industry is highly competitive, and new entrants can easily enter the market. However, Flutter Entertainment plc's strong brand portfolio, diversified product offerings, and established market position provide a barrier to entry for new entrants.

Intensity Of Rivalry

The online gaming industry is highly competitive, with many established players competing for market share. Flutter Entertainment plc's strong brand portfolio and diversified product offerings help the company to compete effectively in this environment.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 41.68%
Debt Cost 6.56%
Equity Weight 58.32%
Equity Cost 8.30%
WACC 7.57%
Leverage 71.48%

11. Quality Control: Flutter Entertainment plc passed 2 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Evolution

A-Score: 5.8/10

Value: 5.1

Growth: 9.4

Quality: 9.5

Yield: 5.0

Momentum: 2.0

Volatility: 4.0

1-Year Total Return ->

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Stock-Card
H&M

A-Score: 4.9/10

Value: 3.8

Growth: 3.3

Quality: 5.1

Yield: 6.9

Momentum: 5.0

Volatility: 5.3

1-Year Total Return ->

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Stock-Card
LVMH

A-Score: 4.2/10

Value: 2.3

Growth: 6.2

Quality: 6.8

Yield: 3.1

Momentum: 2.0

Volatility: 4.7

1-Year Total Return ->

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Stock-Card
Kering

A-Score: 4.0/10

Value: 2.5

Growth: 4.3

Quality: 3.8

Yield: 3.8

Momentum: 7.5

Volatility: 2.3

1-Year Total Return ->

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Stock-Card
Gaming Innovation Group

A-Score: 3.9/10

Value: 4.6

Growth: 7.1

Quality: 5.3

Yield: 0.0

Momentum: 4.0

Volatility: 2.7

1-Year Total Return ->

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Stock-Card
Flutter

A-Score: 3.5/10

Value: 1.5

Growth: 5.9

Quality: 3.5

Yield: 0.0

Momentum: 6.0

Volatility: 4.3

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

157.9$

Current Price

157.9$

Potential

-0.00%

Expected Cash-Flows