Core Viewpoint - Flutter Entertainment plc (NYSE:FLUT) is identified as an undervalued stock with significant upside potential heading into 2026, despite recent price target reductions by analysts [1][2]. Group 1: Analyst Ratings and Price Targets - Joe Thomas from HSBC upgraded Flutter's stock from Hold to Buy, lowering the price target from $265 to $228 [1]. - Ben Shelley from UBS reiterated a Buy rating, reducing the price target from $360 to $340 [1]. Group 2: Valuation and Market Concerns - The stock is currently trading at a price-to-earnings ratio of 20 and an EV/EBIT ratio of 16, which account for UK tax increases [2]. - Concerns exist regarding a slowdown in the US betting market, creating uncertainty around management's return on investment timeline [2]. Group 3: Market Opportunities - The company is expected to benefit from new state liberalization in the US sports betting market [2]. - The UK budget is seen as a major overhaul for the company, with potential catalysts including FanDuel Predicts and legislative openings in the US sports betting market [3]. Group 4: Company Overview - Flutter Entertainment plc is a global online sports betting and iGaming operator, offering a variety of products such as sports betting, casino games, daily fantasy sports, poker, and lottery through multiple brands [4].

Group 1: Company Performance - Flutter Entertainment reported Q3 2025 earnings of $1.64 per share, exceeding Wall Street estimates by $1.14 [2] - The company generated revenue of $3.79 billion, which is $12.75 million above guidance and represents a year-over-year growth of 16.84% [2] - US revenue increased by 9% year-over-year, driven by a 44% growth in iGaming, despite a 5% decline in sportsbook revenue [3] Group 2: Market Position and Analyst Insights - HSBC upgraded Flutter Entertainment to Buy from Hold, citing a buying opportunity after a recent price decline, with a new price target of $228 [1] - The firm believes that the perceived risks in the US and UK gaming markets are overstated and already reflected in the current share price [1] - Flutter maintains its position as the number one online operator in both the US sportsbook and iGaming markets, achieving a 47% NGR market share in September [3]

Core Insights - The U.S. online sports betting market is rapidly expanding, intensifying competition among leading digital gaming platforms like DraftKings Inc. and Flutter Entertainment plc [1][2] - Both companies are enhancing their product offerings and customer engagement strategies to capture a larger market share [2][12] Group 1: DraftKings Overview - DraftKings is focusing on product enhancement and user engagement, leading to solid revenue gains in Q3 2025, with a notable increase in iGaming content [4][5] - The company reported a 25% year-over-year growth in iGaming net revenues and a 17% increase in total sportsbook handle in October [5][7] - DraftKings anticipates continued growth driven by product innovation and expansion into new jurisdictions [7] Group 2: Flutter Overview - Flutter, through its brand FanDuel, is experiencing steady growth with over 14 million average monthly players and a 17% year-over-year revenue increase in Q3 2025 [8][9] - The company is enhancing customer engagement through improved pricing and personalization, contributing to a balanced performance from both U.S. and international operations [8][11] - Flutter expects to benefit from ongoing digital gaming adoption and long-term engagement trends as it continues to innovate its product ecosystem [12] Group 3: Stock Performance & Valuation - DraftKings' share price has outperformed Flutter's in the past six months but remains below the Zacks Gaming industry average [13] - DraftKings is trading at a premium compared to Flutter based on a forward 12-month price-to-sales ratio [14] - Earnings estimates for DraftKings show significant year-over-year improvements of 173.3% and 100.4% for 2025 and 2026, respectively, while Flutter's estimates reflect more modest growth of 8.1% and 39.1% [17][19]

Core Insights - Flutter Entertainment, the owner of FanDuel, announced that the UK government's plans to increase online gaming taxes will significantly impact its adjusted EBITDA, estimating a reduction of approximately $320 million in fiscal 2026 and $540 million in 2027 [1] Financial Impact - The anticipated adjusted EBITDA impact for fiscal 2026 is about $320 million [1] - The projected adjusted EBITDA impact for fiscal 2027 is around $540 million [1]

Core Viewpoint - The UK Government's recent changes to online gaming taxation will significantly impact Flutter Entertainment's adjusted EBITDA, with expected impacts of approximately $320 million in fiscal 2026 and $540 million in fiscal 2027 [1][2]. Tax Changes and Financial Impact - Effective from April 2026, the iGaming tax will increase by 19 percentage points to 40 percent, while from April 2027, the sports betting tax (excluding horse racing) will rise by 10 percentage points to 25 percent [5]. - The adjusted EBITDA impact for Flutter is projected to be $320 million in 2026 and $540 million in 2027, with first order mitigation expected to be around 27% in 2026 and 37% in 2027 [2][6]. Mitigation Strategies - Flutter anticipates that direct first order mitigation, including reduced operational, promotional, and marketing spend, will account for approximately 20% of the gross impact in the first six months post-implementation, increasing to about 40% thereafter [2]. - The company expects to leverage its scale and market position to achieve material second order mitigation benefits, potentially gaining market share and improving operational efficiencies [2][3]. Industry Context - The tax increases are viewed as detrimental to the industry, potentially benefiting illegal gambling operators who do not pay taxes and do not invest in safer gambling practices [3]. - The UK's remote gaming duty is now higher than in countries like the Netherlands, which has previously seen a rise in illegal gambling following tax increases [3]. Company Overview - Flutter Entertainment is a leading online sports betting and iGaming operator with a diverse portfolio of brands, including FanDuel, Sky Betting & Gaming, and PokerStars, generating $14,048 million in revenue globally for fiscal 2024, a 19% year-over-year increase [9].

Core Insights - Flutter Entertainment is the world leader in online sports betting and igaming, with 13.9 million average monthly players globally in 2024 [1] - The company has a market cap of $33.8 billion and reported $15.43 billion in revenue over the past four quarters [2] - The online sports betting market is projected to grow from $53.78 billion in 2023 to $93.31 billion by 2030, reflecting a five-year CAGR of 11.65% [4] Company Performance - Flutter's stock has seen a significant decline, dropping 37% since late August and 25% year-to-date, attributed to increased investment spending, regulatory changes, and unfavorable sporting event outcomes [7] - In Q3 2025, Flutter reported revenue of $3.79 billion, a 17% year-over-year increase, and adjusted EPS of $1.64, exceeding analyst expectations [8] - As of September 30, Flutter had $1.73 billion in cash and liquid assets [8] Analyst Recommendations - Analyst Trey Bowers from Wells Fargo maintains an optimistic long-term outlook for Flutter, citing its strong market position and cash generation capabilities [9] - Bowers rates Flutter shares as Overweight (Buy) with a price target of $272, indicating a potential upside of 41% [9] - Flutter has a Strong Buy consensus rating based on 24 recent analyst reviews, with an average target price of $311.43, suggesting a one-year gain of 61% [10] Industry Trends - The online sports betting sector is experiencing rapid growth, leading to a shift in investor sentiment away from traditional casino companies [4] - Sportradar, a key player in the sports tech industry, provides essential data services for the online betting market, enhancing engagement and betting activities [12] - Sportradar's revenue for Q3 2025 was €292 million, up 14.5% year-over-year, with a profit of €22 million [14]

Core Insights - Missouri's legal sports betting is set to launch statewide on December 1, with analysts predicting a competitive online sports betting market due to the state's population ranking 19th in the U.S. [1] - The first-year betting volume in Missouri is expected to reach between $3.5 billion and $4 billion, coinciding with a busy sports event period and aggressive promotional activities from major betting companies [1] - The legalization of sports betting in Missouri was approved by voters through Amendment 2 in November 2024, allowing for online and physical betting under the regulation of the Missouri Gaming Commission [1] Group 1 - Major players in the Missouri market are expected to include FanDuel and DraftKings as early leaders in betting volume, with BetMGM, Caesars Entertainment, bet365, and Fanatics also holding significant market shares [1] - DraftKings holds one of the two unlinked mobile operating licenses in Missouri, allowing statewide operations without mandatory partnerships with casinos or teams, focusing on same-game parlays and live betting options [2] - Circa Sports unexpectedly received the second unlinked license, known for its precise odds and higher betting limits [2] Group 2 - BetMGM has obtained a temporary license and plans to launch statewide online operations, supported by a market access agreement with Century Casinos [3] - Caesars Sportsbook will begin operations on launch day through existing ownership of Missouri casinos, emphasizing its rewards program for cross-selling between its app and physical casinos [3] - Other notable operators include bet365, which is partnering with the St. Louis Cardinals, and Fanatics, which has secured an online betting license through a market access agreement with Boyd Gaming [3]

Core Viewpoint - The recent decline in shares of DraftKings Inc and Flutter Entertainment PLC is seen as unwarranted by analysts, who believe both companies have significant opportunities in the prediction markets space, estimated at $5 billion [1][3][6]. Company Analysis - DraftKings has an Outperform rating with a price target of $48, while Flutter Entertainment also holds an Outperform rating with a price target of $330 [1][2]. - The total addressable market (TAM) for DraftKings and Flutter in prediction markets is estimated at $5 billion, which includes $4.4 billion for sports prediction markets and $600 million for non-sports prediction markets [4]. - Analysts estimate that DraftKings and Flutter could achieve market shares of 14% and 16%, respectively, in prediction markets in states where online sports betting is not yet legalized [5]. Market Context - Since the end of August, DraftKings and Flutter have seen market capitalizations decrease by approximately $10 billion and $20 billion, respectively [6]. - The market is currently pricing in a worst-case scenario regarding the TAM, assuming that all states legalize online sports betting without allowing the launch of prediction markets [6]. - DraftKings shares closed at $29.44, down 1.83%, while Flutter shares closed at $191.79, down 0.79%, reflecting year-to-date declines of 18.9% and 24.7%, respectively [7][8].

Core Insights - FanDuel has launched "Pass The Leg," a multi-user parlay builder that enhances social interaction in sports betting, coinciding with Thanksgiving [1][3][4] Group Features - The feature allows users to collaboratively build a parlay by inviting friends and family to contribute picks, making it a shared experience [2][3] - Each participant can place individual bets using their own funds and benefit from a dedicated Profit Boost for the group parlay [2][4] Market Position - "Pass The Leg" is the first true multi-user parlay-building experience offered by a major U.S. sportsbook operator, catering to the demand for more interactive betting experiences [3][4] - FanDuel aims to integrate social elements into the betting experience, reflecting how fans engage in group chats and gatherings [4] Operational Details - The feature is available exclusively for the three NFL games on Thanksgiving Day, allowing a minimum of three legs and up to twenty-five total legs in a parlay [3][4] - FanDuel operates across all 50 states with approximately 17 million customers and 25 retail locations, indicating a strong market presence [5]

Core Insights - The article compiles significant research calls from Wall Street, highlighting upgrades and downgrades of various companies that investors should be aware of [1] Upgrades - Wells Fargo upgraded Merck (MRK) to Overweight from Equal Weight with a price target of $125, increased from $90, citing business development and pipeline progress as key factors for revenue growth in the early 2030s [2] - Wolfe Research upgraded Morgan Stanley (MS) to Outperform from Peer Perform with a price target of $198, anticipating accelerated revenue growth from investment banking share gains and organic growth in wealth management [3] - HSBC upgraded Flutter Entertainment (FLUT) to Buy from Hold with a price target of $228, reduced from $265, viewing the recent share selloff as a buying opportunity [3] - BofA upgraded Booking Holdings (BKNG) to Buy from Neutral with an unchanged price target of $6,000, believing that concerns regarding disintermediation risks from Google and OpenAI are overstated [4] - Wedbush upgraded Carvana (CVNA) to Outperform from Neutral with a price target of $400, increased from $380, suggesting that the recent share pullback is overdone [5] Downgrades - UBS downgraded JFrog (FROG) to Neutral from Buy with a price target of $65, up from $48, indicating that while AI-related benefits are significant, the larger revenue impact is likely 12-18 months away [6] - Jefferies downgraded Exact Sciences (EXAS) to Hold from Buy with a price target of $105, up from $90, due to the pending acquisition by Abbott, which is seen as a win for Exact Sciences [6] - Evercore ISI downgraded QuantumScape (QS) to In Line from Outperform with a price target of $12, up from $8, citing valuation concerns as shares have risen 200% year-to-date [6] - UBS downgraded Jazz Pharmaceuticals (JAZZ) to Neutral from Buy with a price target of $188, up from $163, stating that the stock appears fairly valued after a strong Phase 3 GEA update and a 25% stock increase [6] - TD Cowen downgraded PureCycle Technologies (PCT) to Hold from Buy with a price target of $9, down from $16, due to delays in orders and growth plans, prompting a more cautious stance [6]