Analyst Calls Flutter Stock’s 10% Drop After Kalshi’s Sports Prediction Expansion ‘An Overreaction’ — Retail Turns Strongly Bullish

Jefferies believes that the 10.3% slide in shares of Flutter Entertainment is “an overreaction” amid widespread investor worries over risks to the FanDuel operator, as well as its peer DraftKings, from Kalshi’s expansion into sports outcome prediction.

Prediction-market start-up Kalshi reported a record volume of trading over the weekend, due in large part to NFL and college football games. “Nothing beats football in America,” wrote Kalshi CEO Tarek Mansour on X.

Alongside the decline in Flutter shares, DraftKings stock also fell 11.6% on Tuesday. Both stocks recorded their worst trading day in nearly two years as investors saw Kalshi emerging as a substantial threat.

FanDuel and DraftKings offer sports betting in the U.S. states where it is permitted, although regulations might give an upper hand to Kalshi.

Kalshi is registered as an exchange by the Commodity Futures Trading Commission, and its event contracts are traded nationwide. However, the products are different: FanDuel and DraftKings offer conventional betting, while Kalshi offers exchange-traded event contracts.

Jefferies stated that the prediction markets would likely make only a “little dent” in Flutter’s market share, given that consumers prefer breadth and depth of parlays across various markets, games, and sports.. The brokerage maintained its ‘Buy’ rating on Flutter’s shares and a $380 price target, which implies a nearly 50% upside to the stock’s last close.

On Stocktwits, the retail sentiment for FLUT turned ‘extremely bullish’ as of late Tuesday, from ‘bearish’ the previous day, and 24-hour message volume rose 2,900%.

“$FLUT I don’t know where the low is, but I do know this will make a new all-time high within the next six months,” said one user.

As of the last close, Flutter shares are down 1.7% year-to-date.

For updates and corrections, email newsroom[at]stocktwits[dot]com.<