DraftKings Inc. (DKNG) shares are experiencing a significant surge, seemingly driven by the positive guidance issued by Flutter Entertainment (FLUT). Both companies are major players in the thriving online sports betting and iGaming market. Flutter’s optimistic outlook for 2027, which includes an ambitious target of $21 billion in revenue, is generating a ripple effect, lifting DraftKings’ stock price as investors respond to the positive market sentiment.
Flutter’s projections for 2027 are impressive: a compound annual growth rate (CAGR) of 14% for revenue, adjusted EBITDA exceeding $5 billion, a 700 basis point expansion in adjusted EBITDA margin, and free cash flow reaching approximately $2.5 billion. To further solidify their position, Flutter has also approved a share buyback program of up to $5 billion, scheduled to be implemented over the next three to four years, with an anticipated launch following the release of their third-quarter earnings report in November 2024.
The significant total addressable market (TAM) for regulated gaming is estimated to reach a staggering $368 billion by 2030. Global gross gaming revenue (GGR) is projected to grow at a CAGR of 8%, further highlighting the immense potential within this sector. According to Benzinga Pro, DKNG stock has seen a remarkable surge of over 52% in the past year. Investors interested in gaining exposure to this growing market can consider the Roundhill Sports Betting & iGaming ETF (BETZ) and the Pacer BlueStar Digital Entertainment ETF ODDS.
As the online sports betting market continues to evolve, DraftKings stands to benefit significantly from Flutter’s optimistic projections and the overall market growth. This favorable environment positions both companies for potential success in the years to come.
Price Actions:
* DraftKings shares are trading higher by 6.49% at $41.68.
* Flutter shares are trading higher by 6.53% at $243.07.
The positive momentum surrounding Flutter’s ambitious plans and the overall growth trajectory of the online sports betting market are undoubtedly influencing investor sentiment and driving the upward trend in DraftKings’ stock price.
