DAVY VIEW

Flutter’s growth algorithm is becoming familiar – strong local brands, leading product and technology, and worldwide operational expertise are creating significant revenue momentum for the group. Revenues rose by 33% in Q1 (42% excluding its shuttered retail business), strongly underpinned by a similar increase in its customer base (active monthly players (AMPs) increased by 36% in the same period). It results in another meaningful upgrade to our group forecasts – as we suggested at the time of its recent Q1 trading update, our FY21/FY22 revenue forecasts increase by 7%/6% (EBITDA ex-US +4% for both years). Our conviction around the group’s growth prospects continues to grow. Its compelling valuation, with the core business trading on <5x FY22 EV/EBITDA on our revised forecasts, therefore represents a highly attractive entry point. We reiterate our ‘Outperform’ recommendation.