Flutter & DraftKings: Bespoke CEO project
Consumer Discretionary
Paragon Intel is launching a bespoke CEO assessment project on FLUT’s Jeremy Jackson and DKNG’s Jason Robins. While both leaders boast headline achievements, they now confront converging pressures - higher state betting taxes, rising CAC, regulatory scrutiny and complex integrations. With Robins shifting focus towards FCF generation and Jackson tasked with defending FanDuel’s margin edge amid intensifying competition, Paragon will evaluate whether each CEO possesses the capital-allocation discipline, governance model and operating rigour to convert scale into durable profitability. They will also explore how differences in ownership control impact succession, strategic agility and shareholder alignment as the US sports betting market matures.
Edition: 216
- 25 July, 2025
Online Sports Betting / iGaming: Eyes on the prize
Consumer Discretionary
Arete sees the US OSB market growing revenues 6x by 2035E and looks likely to develop into a de facto duopoly. They assume FanDuel (Flutter) and DraftKings will take 70% combined share of handle and 75% share of revenues, with higher structural hold than rivals. Similar story in iGaming; the two companies are using product innovation to take share from legacy casinos and look on track for ~50% combined share, with upside from M&A. Arete has street high price targets for both names. DKNG offers the most upside (~100%) with Arete’s revenues delta vs. consensus improving from +8% in '24E to >30% by '26E, resulting in EBITDA estimates 42% and 51% above consensus, respectively.
Edition: 182
- 22 March, 2024
Consumer Discretionary
888 is unlikely to accept a takeover offer for the time being, according to CTFN's industry sources. This follows an article in the Sunday Times reporting that Playtech made a £1.56 per share offer for the company earlier this year. DraftKings has also held talks with certain 888 shareholders about an acquisition, but CTFN's sources said the company's founding shareholders, the Shaked family, would be unlikely to accept even a £2 per share deal. 888 is operating under new leadership and has a favourable debt package that gives it until 2027 to execute a turnaround.
Edition: 175
- 08 December, 2023
Flutter Entertainment (FLTR LN) UK
Consumer Discretionary
Now trades at a meaningful discount to peers despite dominant position in ALL its major markets - this has been caused by negative, but “fundamentally meaningless” headlines over the last few months. Another issue is that US investors are still not familiar with the company despite FLTR’s US revenues being 50% higher than the No.2 player (its US segment’s implied valuation is just 3.5x FY23 EV / Sales vs. 8x for DraftKings). A spin-out of FanDuel (possibly in 1H22) should provide a catalyst to crystallise the company’s SOTP value; or given the ongoing consolidation in the online gambling space, could Disney be lining up a takeover? TP £200 (80% upside).
Edition: 124
- 26 November, 2021