FanDuel is one of the most popular gambling companies in America. The trouble is, FanDuel stock isn't traded publicly. Because of that, most investors focus on Penn National Gaming Inc. (NASDAQ: PENN) and Draftkings Inc. (NASDAQ: DKNG). But there's a way you can get a slice of the FanDuel stock now...
Flutter Entertainment Plc. (OTCMKTS: PDYPY) is the company that owns FanDuel, along with other online gambling outlets like Paddy Power or PokerStars. And as a bonus, it could be the best stocks to buy in the entire industry.
With four successful divisions and a strong foothold in online betting and casino operations in the United States, Flutter Entertainment is rapidly growing - by 126% over the past two years.
And while most analysts aren't talking about PDYPY, we're going to tell you why this will be the best trade you make in October.
The Rapid Growth of PDYPY
Found five years ago, Flutter Entertainment works through four divisions: Flutter UK&I, Flutter International, Sportsbet, and FanDuel Group.
The Flutter UK&I division are made up of Sky Betting & Gaming, Paddy Power, and Betfair brands in the UK and Ireland sports betting and gaming market.
While the Flutter UK&I handles the companies more regional market, the Flutter International division operates in 19 territories across the world. Led by PokerStars, the world's largest online poker site, the division also includes Betfair International, Adjarabet, and Junglee Games.
Sportsbet, the Australia division, focuses on sports betting services provided to Australian customers for their national sports events.
The FanDuel Group, which is the U.S. segment of Flutter Entertainment, is comprised of FanDuel, of course, as well as FOX Bet and TVG. The division offers a range of online and retail sportsbooks, daily fantasy sports, poker, and online gaming services. As a leader in online sportsbook and casino operator, it's quickly expanding in the U.S. market and is poised to capitalize on the opportunity.
And in those five years, the company has built a platform with 14 million users. That's almost double Draftkings' 8 million users. This rise in users has led PDYPY to grow its revenue to over $3.9 billion for 2020. FanDuel, alone brought in nearly $1 billion in revenue during the first half of 2021.
This is the kind of momentum PDPY is currently riding.
Its why PDYPY is one of the most valuable entertainment companies in the world. And as the industry grows, so will its availability - and in turn its profits.
But that growing profitability relies on how quickly new states come online.
FanDuel Stock Is Taking Over the Gambling Industry
Lucky for Flutter, FanDuel expects another nine states will open its doors to sports betting over the next 18 months. This is happening as the biggest sport gambling season, the NFL, hits its stride.
Two years ago, the company launched the same game parlay with the NFL. But this year will be the company's first as an official partner with the NFL. This gives FanDuel more opportunities to engage sports consumers in ways it hasn't been able to in the past.
FanDuel already accounts for a 45% share and is America's number one sportsbook. Its only real competitor in the sports betting world is DraftKings, which despite its more expensive stock actually has a smaller valuation at $15.5 billion compared to Flutter Entertainment's $30.7 billion.
This indicates that DKNG stock is actually massively overpriced.
Flutter has twice the enterprise value of DraftKings but trades at lower rates because it's a pure-play on the U.S. gambling market. Meanwhile, Flutter has a more diversified business model with slower-growing business lines in Europe and Australia.
The platform is only scratching the surface of the huge potential due to the large population and enthusiasm for sports, and some industry analysts believe that as many as 40 states could eventually legalize sports betting.
Along with its sports betting, PDYPY has a huge hand in online gambling. Gambling in general is one of the largest markets in the world and spans across several formats, products, and customer segments.
It's estimated the total market size of the global gambling industry tops $400 billion and is growing. While most gambling takes place in casinos, online gambling has increased in recent years.
PDYPY is a global leader in the online gambling space, and inevitable growth in the online gambling industry in the United States bodes well for the company. As more states move toward legalizing sports betting and casinos, Flutter Entertainment is well positioned to capitalize on this growth.
How to Play PDYPY Stock
Shares of PDYPY are currently trading around $104. Analysts have PDYPYs 12-month forecast at $132.26, with a five-year forecast reaching as high as $258.15.
Money Morning Quantitative Specialist Chris Johnson estimates they're getting ready to make a move toward $130.
His recommendation? Purchase somewhere along the $100 range and add a 10% trailing stop when shares hit $110. This will secure at least 10% profit if the stock pops.
Regardless of how you play this trade, there's money to be made here.
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