Flutter Entertainment (NYSE:FLUT) Valuation After Analyst Downgrades And US Betting Slowdown

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Flutter Entertainment (NYSE:FLUT) has been in focus after several banks cut their views following reports of slower US online sports betting growth and a broad selloff in gambling stocks. This has left shares volatile and investors reassessing risk.

See our latest analysis for Flutter Entertainment.

Those analyst revisions have landed on a stock that was already under pressure, with a 1 day share price return of 11.46% decline, a 30 day share price return of 37.37% decline and a 1 year total shareholder return of 58.11% decline. Taken together, these figures signal fading momentum as investors reassess US growth expectations and risk.

If this selloff has you looking beyond online betting, it could be a moment to scan our list of 23 top founder-led companies for potential fresh ideas.

With Flutter now trading well below several analyst targets and its own intrinsic value estimate, the key question for you is whether the recent selloff has gone too far or if the market is correctly pricing in slower future growth.

At $125.17, Flutter Entertainment screens far below the most followed fair value estimate of $274.56, putting the focus squarely on what is driving that gap.

Structural cost efficiencies, evidenced by reduced sales and marketing as a percentage of revenue and successful renegotiation of market access agreements (e.g., Boyd), should drive higher net margins and enhanced free cash flow, supporting shareholder returns through buybacks.

Read the complete narrative.

It may be surprising that a loss-making business still lands at that higher fair value. The narrative focuses on margin rebuild, faster earnings compounding and a premium future multiple. The exact mix of those moving parts is what really matters.

Result: Fair Value of $274.56 (UNDERVALUED)

Have a read of the narrative in full and understand what’s behind the forecasts.

However, this hinges on regulators not tightening taxes further, as well as on Flutter managing its US$8.5b net debt and integration risks around deals like Snai and NSX.

Find out about the key risks to this Flutter Entertainment narrative.

If you see the data differently or prefer to piece things together yourself, you can build a custom view of Flutter in just a few minutes, Do it your way.

A good starting point is our analysis highlighting 3 key rewards investors are optimistic about regarding Flutter Entertainment.

If Flutter has you rethinking your watchlist, do not stop here. Some of the best opportunities show up when you broaden your search beyond the obvious names.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Companies discussed in this article include FLUT.

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