On Wednesday, Needham maintained a positive stance on shares of Flutter (LON:FLTRF) Entertainment (NYSE:FLUT), raising the stock's price target to $300 from $270 while reiterating a Buy rating. The decision came after reviewing the company's performance, particularly noting stronger-than-anticipated results in the United States.
The analyst from Needham highlighted that Flutter Entertainment's U.S. quarterly results had surpassed expectations. This success was attributed to the company's superior risk and trading capabilities. In response to these results, the firm has adjusted its 2025 estimates upwards for both U.S. and international markets.
Flutter Entertainment has recently introduced a new product called Your Way, which the analyst believes showcases the company's focus on leveraging data-driven innovation. This product is seen as indicative of the evolving product cycle in online sports betting (OSB), with an emphasis on markets and personalization.
The analyst's optimistic outlook is further supported by the belief that Flutter Entertainment will continue to capitalize on its global scale to achieve local market share gains. The company's strategic initiatives and product offerings are expected to sustain its competitive edge in the industry.
The raised price target of $300 reflects the firm's confidence in Flutter Entertainment's growth trajectory and its ability to outperform in the marketplace. The Buy rating suggests that Needham sees ongoing potential for investors in the stock.
In other recent news, Flutter Entertainment has reported a noteworthy surge in its Q3 revenue, exceeding analyst expectations. The company's adjusted earnings per share were $0.43, surpassing the projected loss of $0.35. Revenue rose by 27% year-over-year to $3.25 billion, beating expectations of $3.05 billion. This robust performance was largely due to a 51% revenue growth in its U.S. operations.
On the heels of this success, Flutter Entertainment has revised its full-year 2024 guidance. The company now expects group revenue of $14.25-$14.55 billion and adjusted EBITDA projected to be between $2.44-$2.62 billion.
In addition to these developments, Flutter Entertainment has announced the initiation of a share repurchase program. The first tranche involves the buyback of up to $350 million worth of its ordinary shares, part of a larger $5 billion program authorized by the Board. This buyback process is set to be managed by Goldman Sachs (NYSE:GS) & Co LLC. The repurchased shares are expected to be cancelled as part of the company's capital reduction strategy.
InvestingPro Insights
Recent data from InvestingPro aligns with Needham's bullish outlook on Flutter Entertainment (NYSE:FLUT). The company's market cap stands at $46.38 billion, reflecting its significant presence in the online betting industry. Flutter's revenue growth of 16.28% over the last twelve months and a robust 20.33% growth in the most recent quarter underscore its strong market position and expansion trajectory.
InvestingPro Tips highlight that Flutter's net income is expected to grow this year, with analysts predicting profitability. This aligns with Needham's upward revision of estimates. The company's high return over the last year, with a 67.34% price total return, further supports the positive sentiment.
It's worth noting that Flutter is trading near its 52-week high, with its current price at 98.15% of the peak. This, combined with the strong returns over the last month (13.06%) and three months (29.67%), indicates significant investor confidence in the company's prospects.
For investors seeking more comprehensive analysis, InvestingPro offers 14 additional tips for Flutter Entertainment, providing deeper insights into the company's financial health and market position.
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