Flutter Entertainment stock maintains Buy rating at Benchmark on strong FanDuel results

Benchmark reiterated its Buy rating and $365 price target for Flutter Entertainment (FLUT), citing robust NFL Week 3 performance from its FanDuel unit, which posted 10% YoY handle growth and 24% YoY gross gaming revenue growth in New York, driven by a 12% hold rate. FanDuel maintained significant market share (35% handle, 42% GGR) within the expanding New York sports betting market, reinforcing Flutter's strong growth prospects and recent strategic moves, including new market access in West Virginia and a partnership with CME Group for prediction markets.

Analysis

Flutter Entertainment (FLUT) has received a reaffirmed Buy rating and a $365 price target from Benchmark, underpinned by the robust performance of its FanDuel subsidiary. During Week 3 of the NFL season, FanDuel demonstrated significant operational strength in the key New York market, recording a 10% year-over-year increase in handle and a 24% rise in gross gaming revenue (GGR). This revenue growth was amplified by an improved hold rate, which expanded to 12% from 11% in the prior year. While the overall New York sports betting market also saw strong expansion with 15.8% handle growth, FanDuel's performance indicates superior profitability, capturing a dominant 35% share of handle and 42% of GGR. This market leadership is complemented by a series of positive analyst actions and strategic developments, including new market access in West Virginia and a partnership with CME Group to enter the predictions market, which support the company's 'strong growth prospects' as noted by InvestingPro data.

Key Decisions for Investors

• Given FanDuel's demonstrated market leadership and strong GGR growth of 24% in New York, investors may consider Flutter a prime holding to gain exposure to the expanding US online sports betting sector.
• Monitoring FanDuel's hold rates and market share percentage in key states is critical, as these metrics are the core drivers of profitability and justification for the stock's current analyst price targets, which range up to $389.
• Investors should assess the execution of recent strategic initiatives, such as the West Virginia expansion and the CME Group predictions market partnership, as successful implementation of these projects could provide incremental growth drivers beyond the core sports betting business.