Jim Cramer Says Flutter Entertainment "Reported What I Call a Mixed Quarter With Soft Revenue"

Flutter Entertainment plc (NYSE:FLUT) is one of the stocks Jim Cramer mentioned in his latest comments. Cramer highlighted the company’s earnings during the episode and said:

“What do we make of these numbers from Flutter Entertainment, the parent company of FanDuel? After the close, this online sports book reported what I call a mixed quarter with soft revenue, thanks to some adverse gambling outcomes, but also higher than expected earnings. At the same time, Flutter announced that it’s moving into the predictions market, much like we heard from DraftKings last week. Their platform, FanDuel Predicts, is launching next month in partnership with the CME Group.”

Flutter Entertainment plc (NYSE:FLUT) operates sports betting and gaming platforms. The company provides online sportsbooks, casino games, poker, lottery products, and fantasy sports. While discussing the sports betting space during the July 9 episode, Cramer mentioned the company and said:

“Take the sports betting space, one of the fastest-growing industries in America over the past few years, dominated by DraftKings and Flutter Entertainment, the parent of FanDuel. There was an obscure provision in the Big Beautiful Bill added late in the process that seems like it could impact these companies significantly… Once the bill was signed into law by President Trump on the 4th of July, people finally started asking what this new rule means for the gaming industry, especially the popular online sportsbooks like DraftKings and FanDuel that dominate the business… But you know what? Since the Senate unveiled its version of the budget bill in mid-June, the version that included the change to the gambling taxes, the stocks of DraftKings and Flutter have been roaring…

Flutter was up 13% and they’re both basically flat in July when people started focusing on this issue. So what the heck is happening here with this taxation thing?… Basically, the new taxation is very bad for professional gamblers or anyone who knows how to win reliably. But those are the last people FanDuel or DraftKings want. In fact, if the budget bill puts these people out of business, it might actually be a good thing for the online sportsbooks… Of course, there’s another reason why Wall Street doesn’t seem to be worried about this change in taxation for gambling winnings. There’s a very good chance it might be reversed…

DraftKings and Flutter haven’t even bothered to push back against the new provision. And historically, these companies are very, very vocal about any legislation that hurts their business. I don’t think they’re shedding any tears over this tax provision that drives away gamblers who win too often. We reached out to both DraftKings and Flutter Entertainment for a comment here… So far, Flutter hasn’t gotten back to us…

Ultimately, I think this is something we need to watch, but it doesn’t change my bullish attitude toward DraftKings and Flutter. The thesis here is very simple: These two companies have emerged as an effective duopoly in online sports betting… This law just makes the moat even bigger for them. There’s building growth to these stories because of the gradual state-by-state rollout of legal sports betting…

Also, because the industry is a lot less competitive than it used to be, DraftKings and Flutter no longer need to offer big incentives to draw new customers, making them more profitable… Here’s the bottom line: I still like DraftKings and Flutter, but more important, this is just one tiny example of the work that’s being done all across Wall Street to figure out the impact of this massive new budget bill. Some of it’s straightforward, but like we saw with sports betting, sometimes these new rules might do the opposite of what you’d expect.”

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Disclosure: None. This article is originally published at Insider Monkey.