Flutter set for first US profit in half-year results
Proactive Investors
Published Aug 02, 2023 14:29
Updated Aug 02, 2023 15:11
Flutter set for first US profit in half-year results
Proactive Investors - Flutter Entertainment PLC (LON:FLTRF), the gambling company, is expected to make a profit in the US for the first time since launching its American sportsbook FanDuel.
Reporting half-year results on 9 August, the company’s consensus predicts underlying earnings, excluding the US, should come in at £763 million, over a 25% jump from the £608 million recorded in the same period last year.
When including US operations, the figure is set to jump by £4 million to £767 million, something Peel Hunt thinks is a “milestone” for the Sky Bet owner.
US betting has soared in popularity since being legalised Source: Financial Times
Expanding in the US has been huge for the firm and while rival Entain (LON:ENT) is following a similar path with BetMGM, 38% of Flutter’s revenues are forecast to come from Stateside operations in the next three years.
By 2026, the US will be Flutter’s largest source of underlying profits, according to Peel Hunt Ltd (LON:PEEL) - little wonder why the group is considering moving to the US, having previously voted in favour of a secondary listing back in April.
Even this year's full-year profits are expected to be lifted from FanDuel’s performance; consensus predicts a £132 million boost, while Peel Hunt is slightly more cautious foreseeing an £89 million bump.
Recently, Flutter and FOX announced they would be shutting down FOX Bet, the online betting brand which accounted for almost a third of US losses in 2022.
With Flutter keeping hold of PokerStars US, analysts at Citigroup Inc (NYSE:C) think the closure will result in a £20-£30 million lift in overall group earnings and provide up to a 23% boost to US profits.
Peel Hunt reiterates a ‘hold’ rating for Flutter and targets a 16,000p share price target, representing more than a 6% premium to the 15,000p price it opened at on Thursday.
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