One of the hottest sports betting websites is Fanduel. For sports fans, it is the ultimate rush and way to show you have the “chops.” As an investor, I was curious about how to buy Fanduel stock.
The short answer is that Fanduel stock is currently private, but investors can buy stock in Flutter Entertainment (OTCMKTS: PDYPY) which owns 95% of the company. When UK-based Flutter Entertainment made the investment into Fandule making it the largest fantasy sports company.
Does the fresh infusion point to an IPO being in the works? A strategy Flutter could be expected to adopt is spinning off a part of the company, which will enable it to encash the perceived value some investors might believe exists in the fantasy sports leader. As more states in the US move to legalize gambling in a bid to raise revenues, there could be a long period of growth lying ahead.
Table of Contents
- 1 About FanDuel Stock
- 2 Is FanDuel a public stock?
- 3 Who owns FanDuel stock?
- 4 Does DraftKings own FanDuel?
- 5 How do you invest in Flutter Entertainment?
- 6 FanDuel Stock: Investing through the back door
- 7 How do I own FanDuel before its IPO?
- 8 FanDuel’s owners are considering publicly listing shares. Here’s the deal.
- 9 Estimated valuation
- 10 FanDuel was acquired in a merger
- 11 FanDuel seems cheap… now
- 12 FanDuel and DraftKings – going head-to-head
- 13 FanDuel and DraftKings Fail Merger
- 14 Comparing FanDuel stock to DraftKings
- 15 Future prospects with Flutter
About FanDuel Stock
FanDuel, which was unveiled in July 2009 is the undisputed leader in the one-week fantasy market. Fantasy sport i.e. NFL MLB NBA NHL. Players draft fantasy sports teams at any time during the season in tournaments and competition games – with an entry fee in each and with a cash prize in ‘every. In 2013 the company awarded more than $150 million in prizes and is expected to award another $400 million in 2014. Currently, with over 100 workers, they have a headquarters in New York City.
Is FanDuel a public stock?
FanDuel is not currently a public stock. There are rumors that it will be public soon.
Who owns FanDuel stock?
Flutter Entertainment PLC (OTCMKTS: PDYPY), a UK company, currently owns almost 95% of FanDuel. Other private investors own 5%.
Does DraftKings own FanDuel?
DraftKings does not own FanDuel, but there was a possible merger just before Covid-19.
How do you invest in Flutter Entertainment?
The best way to invest is through Flutter Entertainment (OTCMKTS: PDYPY) which is listed on the over-the-counter (OTC) exchanges. You will need an online broker that allows investing in OTC.
FanDuel Stock: Investing through the back door
As FanDuel is a private company, investors wishing to be a part of its growth story can come on board by investing in Flutter Entertainment, its parent. Developments in the FanDuel ecosystem are likely to have an impact on Flutter’s share price to a reasonable degree.
There is also a possibility of FanDuel shares being offered to the public, which could also have a knock-on effect on the shares of the parent and could provide an upside to people already invested in it.
You could also invest indirectly through Flutter Entertainment in FanDuel. Flutter is listed under its name pbp in Frankfurt. The shares are presently traded at about €117. As the legalization of sports betting is increasing the game becomes more popular. With this change, the market would probably increase i.e. the value of Fan Duel. If you’re interested in investing before an IPO, see this link to learn what it is and why it could be for you.
How do I own FanDuel before its IPO?
FanDuel is a subsidiary of Flutter Entertainment plc. Flutter operates equity in sports betting, mobile gaming, and other businesses. Flutter staked a stake of 95% in the US gambling giant with Boyd Gaming the remaining stake. For about $4.2 billion Fastball Holdings reportedly bought 37.2% of FB Fanduel in December 2020. The strategy paid dividends after Fan Duel become the US’s No. 1 mobile betting site.
17.8 million Americans will place an online bet for this tournament, an increase in comparison with 2019. Shares of DraftKings rose almost 100% since announcing the recent reverse merger with diamond e-moneys specialty acquisition company blank check SA. FanDuel IPO rumors say recently the company plans an IPO but recently said that this is being considered in some cases, but here’s how you could own.
Not being a public company, FanDuel’s valuation is not in the public domain. However, a picture can be pieced together based on several indicators.
FanDuel’s enterprise value was listed as $11 billion by Flutter when it increased its stake in December 2020. Being a subsidiary, there is no need for Flutter to list separately the capital structure and revenue of FanDuel. Only the US revenue is reported.
While announcing its 2020 results, Matt King, CEO of FanDuel, had said that revenue “grew by 81 percent to $896 million.” This would place it at about 14 percent of the total Flutter revenue.
Based on the above, FanDuel’s current valuation is pegged at $30.6 billion by analysts tracking the company.
FanDuel was acquired in a merger
FanDuel had asked Platinum Eagle Acquisition to go public to raise capital before buying a different entity he said. Unfortunately, it wasn’t. However, Flutter Entertainment bought the company and started together with Paddy Power and Betfair. After the merging, these companies were the Fanduel Group. Betfair is an online casino firm providing the largest betting system. After Flutter purchased the company the two companies combined to form the firm.
FanDuel seems cheap… now
For the time of the recent sale, Flutter announced that FanDuel’s enterprise value was estimated at over $11 billion compared to DraftKkings’ enterprise value of about $18 billion. Flutter Entertainment does not have to list a separate capital structure and only reports total US revenue via sports.
Overall the company has forecast earnings of $850 million in 2020, which would equal about 14% of the company’s revenue. If Flutter decides to spin out a portion to an IPO the move would make sense to unlock value as investors would be willing to pay for a leader within an industry could be decades of growth.
FanDuel and DraftKings – going head-to-head
FanDuel has been locked in close combat at the top of the world of fantasy sports, with DraftKings. The growth trajectory of the two competitors has been similar, with DraftKings apparently a close second to FanDuel at this point.
The two had even contemplated a merger in 2016 when the FTS had nixed the deal on grounds that the merged entity would control over 90% of the market and attain a monopolistic position.
DraftKings, in the meantime, has gone public through the process of a reverse merger with SPAC Diamond Eagle Acquisition Corp.
In another similarity, FanDuel had embarked on a similar path of a reverse merger in 2019 with SPAC Platinum Eagle Acquisition Corp. Talks, well underway in 2019, eventually fizzled out, possibly impacted by the Covid-19 epidemic that swept through the globe starting early 2020 and halted all sporting activity.
FanDuel and DraftKings Fail Merger
DraftKings and FanDuel presented new plans in November 2016. The FTC said the merger violated antitrust laws that made the deal a monopoly. Both companies were removed from the idea but both companies admitted unfair business practices. Both firms are accused of internal trade in Massachusetts and have paid 1.3 million to the Attorney General of Massachusetts. During its talks, Fanduel stated they have a valuation of $1,2 billion. Exactly one month later FanDue founder Nigel Eccles stepped down as CEO many see the change as another clue that FanDue was preparing to sell. But there is a purchase coming.
Comparing FanDuel stock to DraftKings
Flutter said its adjusted annual EBITDA was $1.2 billion in the year. Draft-Kings made headlines for a huge loss in 2020 as it kept the top US operator title. Flutter’s shares were compared to similar offerings on the London Stock Exchange where it has a stock price of £168.75.
Flutter manages a wide variety of. The company is based in London and is currently trading in the United Kingdom with annual revenue of approximately $1bn. Last year, it lost $400 million when it spent $500 million on marketing and sales in the USA.
Future prospects with Flutter
Flutter saw an opportunity in the fans straining at the leash to participate in sports once again and moved to acquire a controlling stake in the company.
At this point, FanDuel does look set for an IPO. It seems to be the best strategy for Flutter to capitalize upon in view of FanDuel’s current valuation and market position. The timing, however, remains open.