Posted on: January 4, 2025, 07:00h.
Last updated on: January 4, 2025, 02:24h.
Flutter Entertainment (NYSE: FLUT) is off to a solid start with its previously announced $5 billion share repurchase program as the sportsbook operator bought back approximately 9,600 of its shares on the final trading day of 2024.
That was followed by the purchase of more than 13,000 shares on Jan. 2 — the first trading day of 2025. Goldman Sachs executed the buybacks on the open market on behalf of the Dublin-based gaming company. Flutter previously said it planned to commence buying its own stock in November.
The redemptions form part of Flutter’s intention to buy back Ordinary Shares of up to $350 million in the period to March 31, 2025 following the announcement of the share buyback program on November 13, 2024 (the “Buyback”) and form part of Flutter’s intention to buy back $5 billion of shares as announced on September 25, 2024,” according a statement.
Following the repurchase activity, the FanDuel parent “will have 177,881,080 ordinary shares in issue.”
Flutter Finding Some Value in Buybacks
Flutter close at $256.76 on Friday, or nearly 10% below its 52-week of $284.79. On the basis of space between the 52-week high and the repurchase prices, the gaming company is getting some value in its shares.
On Dec. 31, the price range of the repurchased Flutter equity was $256.26 to $260.08. On Thursday, that range was $254.96 to $260.04. Companies are not obligated to repurchase the entirety of the announced amount, but if Flutter were to proceed with buying back $5 billion worth of its share, that would represent a significant chunk of is market capitalization of $45.34 billion.
If Wall Street is correct in its outlook, Flutter’s market value is poised to soar. Of the 22 analysts covering the stock, 20 rate the equivalents of “strong buy” or “buy” and the average price target on the shares is $303.90, or 18.36% above the Jan. 3 close.
FanDuel is one of the most valuable gaming brands in the world and in the US, it’s part of an online sports betting duopoly with DraftKings (NASDAQ: DKNG) being the other member.
Flutter Going Big with Buyback
The Betfair parent said in September it plans to repurchase $5 billion of its shares over the next several years. That was good for one of the largest buyback plans announced in the gaming industry in 2024 and five times the repurchase scheme announced by rival DraftKings a month prior.
Flutter’s plans to return capital to shareholders in the form of a repurchase program is the operator’s first such announcement since it listed on the New York Stock Exchange (NYSE) in early 2024. In the middle of last year, the company shifted its primary listing to the US.
That’s served the objective of increasing Flutter’s investor base, particularly among US professional market participants while boosting liquidity in the shares.
