March Madness: Flutter Stock Is a Solid Bet on Sustained Growth

Core Viewpoint - Flutter Entertainment is positioned as a leading player in the online sports betting and gaming industry, with significant revenue growth and ambitious future targets [2][4]. Group 1: Company Overview - Flutter Entertainment is the world's leading online sports betting and gaming operator, primarily known in the U.S. for its FanDuel sportsbook [2]. - In 2024, Flutter generated over $14 billion in revenue, significantly outperforming its competitors, with 60% of its revenue coming from the U.K. and the U.S. [3]. Group 2: Financial Goals and Projections - The company aims to achieve $21 billion in revenue by 2027, representing a compound annual growth rate (CAGR) of approximately 14% [4]. - Flutter targets a 25% growth in adjusted EBITDA margin, equating to about 700 basis points of margin expansion [4]. - The company anticipates free cash flow of $2.7 billion by 2027, indicating approximately 36% compound growth [4]. - Flutter plans to return up to $5 billion in capital over the next three to four years [5]. Group 3: Market Dynamics - In 2025, an estimated $3.1 billion is expected to be wagered on NCAA basketball tournaments, which is about 25% of Flutter's annual revenue [6]. - As of March 2025, 38 states have legalized sports betting, but FanDuel is only licensed in 23 states, with limited expansion expected in major markets like Texas and California [7][8]. Group 4: Analyst Sentiment - Flutter stock is currently trading at $241.61, with a 12-month price forecast of $311.41, indicating a potential upside of 28.89% [7]. - Analysts from UBS Group and Macquarie have set price targets of $340 for Flutter stock, which is nearly 10% higher than the consensus price [9].