Flutter’s Stock (FLUT) Gains New Street High Initiation at $380

Flutter Entertainment's stock (NYSE: FLUT) has been given a boost, as the resumption of coverage by Jefferies analyst James Wheatcroft, came with a “Buy” rating, and a street-high price target of $380. This bullish outlook, coupled with recent strategic acquisitions, strong financial performance, and a robust share buyback program, paints a compelling picture for Flutter's future, although potential headwinds remain.

The stock closed out the most recent session at $282.85, up 0.64% on the day. The Jefferies price target represents a significant upside, suggesting that the market has yet to fully appreciate Flutter's growth potential.

Wheatcroft’s analysis hinges on projections of 17% annual EBITDA growth and 31% revenue growth over the next three years, arguing that the current share price doesn't reflect these robust expectations. He cites Flutter’s “macro insulation,” a simpler business narrative following its recent streamlining efforts, and several key catalysts as drivers for future growth. These catalysts include potential inclusion in U.S. stock market indices, ongoing share buybacks designed to enhance shareholder value, and increased penetration of the company’s “YourWay” personalization platform.

Flutter has also been strategically expanding its global footprint. The company recently completed the acquisition of a 56% stake in Brazil's NSX Group for $350 million, aiming to capitalize on the rapidly growing Brazilian online betting market. Additionally, Flutter finalized the acquisition of Italian online games provider Sisal Gaming for €2.3 billion, bolstering its presence in the European market.

Despite the positive outlook, Flutter operates in a highly competitive and heavily regulated industry. Changes in regulations, particularly in the rapidly evolving U.S. market, could significantly impact the company's profitability. Furthermore, the global economy remains uncertain, and a downturn could negatively affect consumer spending on discretionary activities like online gaming.