Bet Big On Flutter's 'License To Print Money'

11월 14일

It is often said that “a gambling license is a license to print money." If that's true, then Flutter Entertainment is a massive cash machine.

🌎 As a leader in the global gaming industry, Flutter is capitalizing on the massive growth of sports betting and gambling, especially through FanDuel in the U.S.

Here’s why we're bullish on FLUT and think it’s worth buying:

1️⃣ Huge Growth Potential
Flutter’s revenue has skyrocketed from $1.1 billion in 2014 to $12.8 billion in the last year, thanks in large part to FanDuel. And there’s still a lot of untapped potential. Major U.S. states like Florida, Texas, and California haven’t even legalized sports betting yet, which could unlock billions more in revenue.

With digital betting on the rise, we think Flutter could hit $20 billion in revenue by 2028. 📈

2️⃣ Expanding Margins
To win market share fast, Flutter spent big on promotions and marketing, which tightened margins. But now they’re focusing on operational efficiencies and cost control. Margins are starting to climb, and with an impressive 12% cash margin, they’re well-positioned to boost profitability over the next few years. 💰

3️⃣ Long-Term Value
Right now, FLUT trades at around a 16.5x P/E ratio on expected 2028 earnings. Not bad, considering the growth ahead. While earnings are lean now (no dividend yet, either), Flutter’s forward PEG ratio tells the real story – there's substantial value here if you're willing to ride out a few years of growth and expansion. 📊

Risks to Keep in Mind
⚠️ Regulation: New gambling taxes or stricter regulations could hit profits. ⚠️ Competition: Other big players like DraftKings and MGM are also fighting for market share, which could drive up costs and squeeze margins.

Bottom Line
Flutter has a solid foundation for long-term revenue growth with plenty of room for profitability gains. 📈 With strong market positioning and smart expansion strategies, we like this as a 'long' play going forward.

Hence our 'Strong Buy' rating at today’s price. 💪

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