Flutter Entertainment (NYSE: FLUT), a dominant force in online sports betting, has been one of the market's hardest-hit stocks over recent months.
Overall, shares of the consumer discretionary company are down over 50% in 2026, and have fallen more than 60% from their 52-week high.
The most notable cause of Flutter’s decline is competition from prediction market platforms. This includes firms like Kalshi, which has a partnership with Robinhood Markets (NASDAQ: HOOD).
With shares down so dramatically, it's fair to ask whether this name can stage a strong recovery. Several factors suggest this could be the case, including Flutter’s impressive strengths in the gambling industry and a key defense it has against prediction markets.
Flutter’s FanDuel Edge: Monetization Matters as Much as Volume
Flutter has several key advantages in the online gambling industry.
First, it helps to separate “who gets the most bets” from “who makes the most money per bet.” Flutter’s U.S. sportsbook is FanDuel, which has long competed near the top of the U.S. market alongside DraftKings (NASDAQ: DKNG).
Two key metrics provide important signals around FanDuel and DraftKings' positioning. On handle, or the total amount of dollars that bettors wager, DraftKings leads with a market share of 37% versus FanDuel’s 32.5%. However, on gross gaming revenue (GGR), this relationship flips.
GGR is the amount a sportsbook keeps after paying out winnings, and it can be influenced by product mix and promotional intensity. In practical terms, a sportsbook that converts more wagering into revenue is often in a stronger position than one that simply posts higher betting volume. And FanDuel holds 39.6% market share, while DraftKings is at 35.3%.
So, while DraftKings has a significantly higher amount of dollars wagered on its platform, FanDuel’s GGR is significantly higher. This is a key distinction, showing that FanDuel loses bets substantially less often than DraftKings.
In this sense, FanDuel is in an advantageous position. Ultimately, operating a well-functioning sportsbook comes down to how much of your handle you can actually turn into revenue. FanDuel’s advantage here stems from a variety of factors, including its higher percentage of hard-to-win parlay bets and its reluctance to use promotions.
Overall, FanDuel has an advantage over DraftKings in that its users are more valuable because it makes more money from them.
Something else Flutter has that is almost non-existent at DraftKings? An international footprint.
In 2025, around 97% of DraftKings' revenue came from the United States, compared to just 43% of Flutter’s revenue. Flutter’s international revenue alone totals near $9.4 billion—more than 50% higher than DraftKings' total revenue of $6.05 billion.
Why Parlays Are a Critical Shield Against Prediction Markets
Despite its strengths, prediction markets have been a huge headwind for Flutter shares.
While prediction markets provide a way to bet on the outcomes of events, including sports, their business model is structurally different from traditional sportsbooks like Flutter.
Sportsbooks love parlays, which require multiple events to occur for a bettor to win, because the odds stack heavily in their favor. If a user bets a parlay that four NFL teams will win that week, but only three do, they lose the entire bet. That math adds up at scale: parlays often account for a sizable portion of sportsbook revenue. For example, during September 2024, parlays accounted for 72.5% of sportsbook gross revenue in New Jersey.
However, it would be very difficult for prediction markets to offer parlays to the same extent as sportsbooks can. Sportsbooks can make offers on any bet, at any time, to anyone, because users are ultimately wagering against sportsbooks themselves. One of the main reasons people like parlays is their highly customizable nature.
In contrast, prediction markets are generally peer-to-peer: a buyer and seller must agree on opposite sides, and liquidity constraints can make highly customized, low-volume combinations harder to support. The platform itself is not directly involved in the bet; it simply offers a place for users to wager against each other. More importantly, the economics of prediction markets are such that a very large number of users need to take the opposite side of each highly customized bet.
This means that Flutter’s most important revenue stream, parlays, arguably has a significant layer of protection against prediction market competitors.
Furthermore, legislators are starting to push back on prediction markets. A recently introduced bipartisan Senate bill would limit prediction-market contracts that resemble sports betting, and the category has also faced legal and regulatory challenges in multiple states.
As Flutter’s Valuation Tanks, Analysts Eye Big Gains
Flutter shares have fallen so much that it is reasonable to think that the markets are overreacting.
FLUT now trades at a forward price-to-earnings ratio of just 16x, nearly half of its 30x average over the past two years.
Wall Street analysts also see huge upside potential in Flutter.
The MarketBeat consensus price target is near $223, implying more than 100% upside.
Targets updated after Flutter’s latest earnings report are significantly lower, however, averaging around $178.
Still, this figure would mean a potential upside of more than 65%.
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The article "Analysts See 100% Upside in Flutter Stock Despite Prediction-Market Pressure" first appeared on MarketBeat.
