Why Flutter Entertainment May Be a Resilient Sports Betting Stock

Key Points

• Flutter Entertainment's stock is down after a miss on the top and bottom lines, but the stock is moving higher as investors view the bigger picture.
• Sports betting stocks are under pressure due to limited new state approvals for online betting, but the bottom may already be in.
• Despite missing revenue targets due to customer-friendly results during March Madness, Flutter's pricing strategy and expected outcomes suggest long-term profitability.

Flutter Entertainment PLC NYSE: FLUT, which many U.S. investors know as the parent company of the sports betting site FanDuel, announced its quarterly earnings on May 7. The company missed on the top and bottom lines. Earnings per share (EPS) of $1.59 missed estimates of $1.89. Revenue of $3.67 billion came in light of expectations for $3.84 billion.

FLUT stock dropped approximately 4% on that news, but has cut that loss nearly in half as of this writing. Investors are taking a closer look at the report and less at the headline numbers. When they do, they see a solid company in a resilient industry that may have the worst priced in.

One of those highlights came from the company's ownership stake in the media property, FanDuel TV. This network provides regional channels for 30 professional sports teams in the NBA, NHL, and MLB. Ahead of Flutter’s earnings report, the network announced it had reached 650,000 paid streaming subscribers and expects to hit 1,000,000 direct-to-consumer (DTC) customers by the end of 2025.

Why Are Sports Betting Stocks Under Pressure?

FLUT stock is down 6.3% in 2025 as of May 8. That’s nearly identical to DraftKings Inc. NASDAQ: DKNG, which is down 7%. It would be easy to point to the broad weakness in consumer discretionary stocks, but that may be overstating things.

A key reason these stocks are down is that there aren’t many states with sports betting initiatives on the ballot in 2025. Many of the largest states have already approved sports betting. Two holdouts, California and Texas, are likely to stay closed to online sports betting in the short term.

However, it’s important to note that companies like Flutter Entertainment and DraftKings have online casinos for iGaming, which allow them to avoid the impact of brick-and-mortar casinos. That’s been weighing down other competitors like Churchill Downs Inc. NASDAQ: CHDN, which is down about 30% in 2025.

The House Doesn’t Always Win

Sometimes, management commentary can get comical. In explaining why the company missed its revenue and earnings forecast in the quarter, chief executive officer Peter Jackson cited “customer-friendly” results during the NCAA Men’s Basketball Tournament (i.e., “March Madness”).

In plain speak, here’s what the company is saying. A lot of favorites won in this year’s tournament. Many bettors bet on the favorites. That means consumers won their bets. That's what investors need to know. The house didn’t win.

However, that’s not to say it can’t win. On the earnings call, Jackson said the company remained confident in its sportsbook pricing and its ability to price each market based on its expected outcome. Over time, Jackson wrote, this will mean the company’s gross revenue margins “will align to expected outcomes.” That means it expects the house to win over time.

Sports Betting Can Be Resilient in Tough Economic Conditions

Two issues weigh heavily on investors: concerns over tariffs and worries about a recession. Many investors are turning toward defensive stocks, which frequently mean “sin stocks” that focus on alcohol, tobacco, and gambling.

Unlike other discretionary expenses, sports betting is something that consumers will continue to engage in even under adverse economic conditions. Equally important, this is an industry that will be shielded from tariffs.

Analysts Are Bullish on FLUT Stock

As of this writing, FLUT stock has pulled back to its 50-day simple moving average (SMA). Significantly, it crossed above that in the market rally in late April. Traders may want to see if the stock can find support at this level for another leg higher.

However, if you’re interested in making Flutter Entertainment more of an investment than a short-term bet, it may be more of a sure thing. The Flutter Entertainment analyst forecasts on MarketBeat have a consensus Buy on FLUT stock with a price target of $306.67, which would be a 27% upside.