Jefferies analyst upbeat on Flutter, raises guidance
Jefferies Equity Research analyst James Wheatcroft placed a “Buy” rating on FanDuel parent Flutter Entertainment in a 29 April investor note.
Wheatcroft gave Flutter a price target of US$210 per share. That was a 93% premium to the stock’s current price. Flutter shares were trading at US$109.09 apiece at the time of Wheatcroft’s dispatch. He also raised his revenue estimates for 2027 by 1%.
The analyst attributed negative market sentiment on Flutter to the cost of launching in Arkansas, as well as unfavorable sports numbers in the United Kingdom, Italy and Brazil. “While 1Q headlines are unlikely to excite, we continue to see an appealing set-up,” he wrote.
Although FanDuel’s revenue growth had been underwater in December, Wheatcroft said it was showing initial signs of improvement. He credited easier comparisons, the imminent World Cup, new Bet Protect+ and increased promotional spending as harbingers of second-quarter growth.
“Company commentary and industry data still suggest limited direct-prediction market cannibalization, though several operators have called out” a high cost of obtaining customers, Wheatcroft reported. And although FanDuel was projecting no prediction-market revenue of its own, he said that downloads of its FanDuel predicts app were at 6% of Kalshi’s download volume.
Assessing the effect of United Kingdom tax increases, Wheatcroft depicted Flutter as finding itself boosted by tailwinds in its market-share size. But it also was facing headwinds from black-market competitors. “Peers have thus far reported early signs of stable trends,” Wheatcroft concluded.
David McKee is an award-winning journalist who has three decades of experience covering the gaming industry.
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The Backstory
Why Jefferies keeps leaning into Flutter
Jefferies’ stance on Flutter Entertainment has evolved but stayed constructive through a volatile stretch for U.S. sports betting. Analyst James Wheatcroft has argued for months that market pessimism on FanDuel’s parent is outpacing fundamentals, even as he reset expectations to reflect slower handle growth, leaner promotions and a choppy sports calendar. In March he defended the stock while slashing his price target, contending that investor fears were conflating cyclical pressure with structural risk. He reiterated a buy as he looked for state data and company updates to reengage investors and support a re-rating.
That March recalibration followed a winter in which Jefferies sought to separate narrative from numbers. In early February Wheatcroft said softness in FanDuel’s handle did not signal an existential threat from prediction markets and that cash generation was tracking close to plan. His argument: transient drivers were weighing on handle, but the business could still hit double-digit revenue and cash flow growth via mix shift and discipline. By summer, he was again underscoring the multiyear runway in the U.S. and Flutter’s diversified international base, even as he acknowledged a decelerating handle backdrop.
The arc from peak optimism to a reset
Jefferies’ tone peaked last year when Wheatcroft set a Street-high target and laid out a long runway for penetration gains and new state launches. He highlighted a path to midteens revenue growth and stronger cash flow even without a rebound in headline handle. The thesis hinged on maturing promotional practices, higher-margin bet types and product upgrades offsetting slower top-line wagering growth. He also emphasized Flutter’s “podium” positions outside the U.S., which provide ballast when American sports outcomes and promotions create volatility.
That conviction was tested as the industry’s handle cooled. In a July analysis, Wheatcroft noted that U.S. handle growth slowed to the midteens into late 2024 and further into early 2025, with Flutter underperforming the market as fewer new states launched and operators dialed back free bets. He traced part of the deceleration to mix: more in-game and parlay betting that lifts margins but dampens total dollars wagered. He also cited a softer NBA season, fewer NFL playoff games and less promotional noise, factors that can compress handle even as revenue per dollar of handle improves. The core view: handle moderation was not inherently bearish for earnings power.
Parsing the prediction market debate
As prediction markets grabbed headlines, Jefferies consistently pushed back on claims of meaningful cannibalization of regulated sportsbooks. In a Feb. 8 note, Wheatcroft said company commentary and available data suggested limited substitution, pointing instead to calendar quirks and sharper promotional discipline as the main culprits behind lower handle. He expected management to reiterate that stance and to detail a path to double-digit growth with only low-single-digit handle gains. He also modeled FanDuel Predicts as a cost lever and learning platform rather than a near-term revenue driver.
That framework carried into March, when Wheatcroft again defended Flutter and argued that “material prediction market entry” plus state reporting could become a catalyst for investor reassessment once the noise cleared. He maintained a buy while cutting his target to reflect the slower near-term cadence, saying downgrades stemmed largely from NFL results and reduced promotions, not from structural share loss to prediction platforms. Weeks later, he returned to the name with a refreshed view of the second quarter set-up and a nod to easier comps, product safety upgrades and World Cup tailwinds.
What rivals signal about demand, promotions and taxes
Operator commentary outside Flutter offers corroborating signals. In late April, BetMGM reported first-quarter results that topped internal guidance, with online sports betting revenue up strongly despite a modest rise in money wagered. Management flagged stable promotions and moderating customer acquisition costs while cautioning that slower handle growth was likely as the industry keeps rationalizing offers. They also highlighted a mix shift toward parlays and in-game play that can suppress handle but lift margins. BetMGM called prediction markets a niche with legal questions and said it would participate only if required, framing risk as bounded in regulated states. On taxes, BetMGM saw no sweeping wave of hikes but warned about localized pressure in some jurisdictions and continued lobbying for sustainable rates. For a read-through, see BetMGM’s first-quarter profit beat and outlook on promotions, taxes and prediction markets.
Regional competitor Rush Street Interactive has voiced a similar view on promotions and the legal overhang around prediction markets. Executives told investors at G2E that prediction-market momentum could prod states to legalize igaming to protect tax bases, especially where sports betting is already live and infrastructure exists. RSI also underscored that its heavier igaming mix insulates results from sports hold swings, a dynamic that supports Jefferies’ contention that revenue and cash flow can advance even during handle softness. For more on that positioning, see Rush Street Interactive’s G2E read on market share, igaming resilience and prediction markets.
International crosscurrents and the U.K. read-through
Jefferies has balanced its U.S. optimism with caution on international headwinds. Wheatcroft has flagged unfavorable results in some European markets, taxation risk and competitive pressure from gray operators as drags that can obscure progress. Still, he has pointed to the United Kingdom as evidence that revenue can climb even when handle is flat, aided by pricing, product and mix. In his February work he cited U.K. revenue up sharply since 2024 despite steady handle, a data point he uses to argue that FanDuel’s midteens U.S. growth target is achievable with only modest handle gains. He has trimmed revenue and cash flow expectations modestly against company guidance, but kept U.S. cash generation broadly in line with management’s outlook.
That nuance showed up again in March, when he removed unmodeled U.S. upside from his valuation to stay conservative, then posited that improving weekly trends ex-NFL could unlock estimate momentum later in the year. He also highlighted nascent benefits from FanDuel Predicts on the cost side while modeling little near-term revenue, consistent with management’s stance of testing the channel while the legal landscape evolves.
The stakes: investor patience versus cyclical noise
The through line in Jefferies’ coverage is a belief that the market has overweighted headline handle and prediction-market headlines while underweighting earnings power from mix, product and rational promotions. In July, Wheatcroft framed the sector’s slower handle as a natural result of fewer state launches and less bonus inflation, not a demand cliff. In February and March he argued that negative NFL variance and austere promotions had exaggerated the downdraft in year-over-year comparisons, and that early 2026 state data showed stabilization in key markets like New York. See Jefferies’ Feb. 8 analysis on nonstructural drivers of handle softness and the March 6 defense of Flutter with a reset target for detail.
The bet now is that easier comps, global football’s calendar, safety features like Bet Protect+ and a steadier promotional baseline will support second-quarter and second-half recovery in growth rates. If that plays out, Jefferies expects investor focus to shift back to unit economics and long-term cash generation, where Flutter’s scale and mix still look advantaged. For the broader industry, operator testimony suggests that steadier promotions, mix-driven margin gains and regulatory clarity on prediction markets could keep earnings ahead of headline handle for longer than the market assumes. That is the frame through which Jefferies continues to view Flutter.
