Flutter Entertainment PLC (LSE:FLTR, NYSE:FLUT)FanDuel Predicts app could generate $125 million in annual revenues not yet factored into company guidance or market consensus, according to Jefferies, which rates the global betting and gaming group a 'buy with a 16,000p price target.
That's more than double the current share price, which sits at 7,636.95p, up 34.95p.
The investment bank's analysts note that FanDuel Predicts, Flutter's prediction market app, has sustained strong download momentum following its first major marketing campaign earlier this month.
Daily downloads peaked at 48,000 on 14 March before settling at an average of around 11,000 over the past week, well above the 3,000 daily average recorded through February prior to the campaign launch.
Jefferies estimates that FanDuel Predicts has captured around 30% of incremental downloads among major US prediction market apps since the campaign began, with cumulative downloads now at 5% of those achieved by rival Kalshi.
If FanDuel Predicts volumes were tracking at the same 5% share of Kalshi's activity, which runs at $125 billion annualised, that would imply run-rate revenues of $125 million for Flutter, a figure currently absent from both the company's own guidance and analyst consensus.
The picture is complicated, however, by mounting legal pressure on the prediction market sector more broadly.
Arizona became the first US state to file criminal charges against Kalshi for allegedly offering illegal sports and election betting without a gaming licence, while Nevada became the first to force Kalshi offline entirely, issuing a temporary restraining order lasting 14 days.
A bipartisan Senate bill seeking to prohibit prediction markets from offering sports event contracts has also been introduced, following a similar bill in the House earlier this month.
Jefferies says a ruling in the Ninth Circuit Kalshi-Nevada case, expected in the coming months, is likely to be decisive, as it would represent the first appellate court decision on the regulatory jurisdiction of sports event contracts and could shape the trajectory of cases in other states.
On Flutter's core online sports betting business, handle trends remain subdued, with the company's US performance tracking at minus 9%, minus 5% and minus 2% across January, February and March, respectively in New York state.