DraftKings, Flutter Shares Tumble on NFL Woes; Buybacks Offer Support
Shares of DraftKings and Flutter Entertainment have been volatile recently, with both companies facing challenges in the current NFL standings. Analyst Jordan Bender has revised his 2025 EBITDA forecasts for both companies, while also estimating lower-than-expected Q3 EBITDA. Despite these setbacks, both companies have share buyback programs in place that could provide support for their share prices.
Jordan Bender, a research analyst at Citizens Equity, has reduced his 2025 EBITDA forecasts for DraftKings and Flutter Entertainment. For DraftKings, the forecast has been lowered to $705.3 million, down from $871.6 million. Similarly, Flutter's forecast has been revised to $3.18 billion, down from $3.32 billion. Bender attributes this revision to the volatile gaming margins expected for the remainder of the 2025 NFL season.
The analyst also estimates that DraftKings' Q3 EBITDA will be -$102 million, significantly lower than the consensus estimate of +$51 million. For Flutter, Bender estimates Q3 EBITDA at +$44 million, below the consensus estimate of +$143 million. This revision follows a challenging Q3 for both companies, with NFL customer-friendly outcomes negatively impacting their earnings.
The recent volatility in DraftKings and Flutter shares has seen their prices fall below the 200-day moving average, potentially inviting short sellers. This volatility has been driven by high volume on prediction markets and same-game football parlays. However, Bender suggests that in the absence of prediction market headline risk, shares of both companies could find a bottom as they lean into share buybacks.
Despite the recent challenges and revised forecasts, both DraftKings and Flutter Entertainment have share buyback programs in place. These programs could provide support for their share prices, helping to mitigate the impact of volatile gaming margins and other headwinds. As the companies navigate the remainder of the NFL season, investors will be watching closely to see how these programs are implemented and their impact on share prices.
