The impressive performance from Flutter Entertainment PLC's (LSE:FLTR) fast-growing FanDuel business in the US has led Deutsche Bank to up its share price target for the bookmaker.
First-half results provided a "strong finale" to the sector's recent results season, said analyst Simon Davies, hiking his target to £187.17 from £175.89, versus the last closing price just over £160, and reiterating a 'buy' rating.
The H1 results delivered a "material" beat to forecasts for underlying earnings (EBITDA), as "the US started to deliver significant operational gearing", he said.
"And in the face of investor concerns over the potential impact from rising gaming taxes in Illinois, and a continued focus on ramping up customer acquisition, Flutter still managed to deliver a 4% uplift in guidance for group EBITDA."
It was helped by a favourable run of results in the Euros, which gave an expected boost to the UK and international businesses, while Australia was also better than feared, also bailed out by sporting results.
But the US business was the "real outlier", delivering EBITDA up 51% to $260m, with margins up by 130 basis points.