FanDuel Parent Breaks Out On Growth Plan, $5 Billion Buyback

Flutter Entertainment, the parent company behind sports betting and gambling platforms including FanDuel and Paddy Power, announced a new long-term growth plan and authorized a massive repurchase initiative Wednesday, ahead of its investor day presentation. FLUT stock rallied early Wednesday to break out. Rival DraftKings also jumped on the report.

Flutter Entertainment (FLUT) provided medium-term 2027 guidance alongside its new $5 billion share repurchase program.

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Flutter estimated a regulated, total addressable market (TAM) of $368 billion for 2030 for global gross gaming revenue (GGR), with a compound annual growth rate (CAGR) of 14%.

The FanDuel parent put the midpoint of its U.S. and rest of world (ROW) 2027 revenue at $21 billion in revenue, representing a three-year CAGR of 14%.

The company targets 2027 adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) of more than $5 billion, while its adjusted EBITDA margin grows to 25%.

Flutter reported is North American TAM is now expected to be approximately $70 billion, with the U.S. representing a bulk of that market at $63 billion. The TAM for the U.S. was about $40 billion in 2022, according to Flutter.

The betting company expects its sportsbook GGR margin to reach 15% in 2027, with a long-term goal of achieving 16%. Flutter forecasts a long-term net gaming revenue (NGR) margin of 12% for FanDuel.

The company expects the midpoint of 2027 revenue from existing states, where sports betting and iGaming products are currently legal, to be about $9.7 billion.

Flutter also maintained its long-term adjusted EBITDA margin outlook between 25% and 30%, expecting to reach 25% by 2027.

The company said it has “significant” opportunities to expand further from states that have yet to regulate its betting products. The FanDuel parent also maintained its expectations for 80% sportsbook population coverage and 25% iGaming population coverage for the U.S.

FanDuel Stock

Flutter shares spiked more than 8% early Wednesday, exiting a buy zone to hit record highs. FLUT broke out above the 226.40 buy point for the 27-week base on Sept. 17. Shares of the FanDuel parent were up 16% in 2024 through Tuesday’s close.

Rival DraftKings (DKNG) jumped 4% Wednesday morning on the report.

DKNG stock made a strong move off its 200-day moving average on the bounce. Shares fell below that long-term technical line in mid-July and retook the level last week. DraftKings leapt 11% this year through Tuesday.

You can follow Harrison Miller for more stock news and updates on X/Twitter @IBD_Harrison

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