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Markets hate uncertainty, which may well extend beyond the next election, so this could hold the price back for some time. I cannot see HMG hobbling any business which provides not only so much employment in their own and the horse racing business, but also pays enormous amounts in taxes. All of which is bound to affect the SP until we know exactly what is contained in proposed legislation. Meantime we have to deal with the Gambling White Paper, which is bound to be accompanied by a media explosion of horror stories relating to problem-gambling. The American tail is now well on the way to wagging the Irish dog. I remain a very firm holder of FLTR, having bought in as a believer in the USA as transformational to any UK bookie plc who teamed up with the right local partner. So there is money there to buy and hold an expensive 18.6% of FanDuel, though whether they'd want to do that for a junior-partner's sleeping investment, who knows? I've no idea of the extent of Fox's UK operations, but I do see adverts on ITV Racing and presume the company is ultimately owned by our dear friend, the lovable Rupert Murdoch. I have, however, been astonished before at the seeming incompetence of highly-paid advisers to plc's, so that means nothing. We don't know the wording of the Option Price Clauses, but given that Exercise Price is absolutely central to any option agreement, I'd be astonished if FLTR's lawyers agreed any vague wording that gives Foxbet room to seriously argue that they're entitled to buy at an historic and way-outdated number. That might explain why there's no settlement and it's going to arbitration. This makes me wonder if the only reason they came into the FanDuel deal at all was to get the option to buy 18.6% cheaply and then flip it to FLTR later at future market value.
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It's obvious that Foxbet are spending no money on their US operation and at 1% penetration, excluding Nevada, the business is worthless. RE: UK White Paper and US's Fox Corp Arbitration in June 4 May '22Ĭukkas, that's a really interesting March article from 'frontofficesports'. I regard this as an opportunity to buy more at prices which, I hope, will seem laughably cheap in two years time - but, but, but, I have been wrong before. In the meantime, we'll have to deal with the Gambling White Paper and the Foxbet arbitration result, neither of which will do anything for the SP until we get clarity and the current fog clears.
#FLUTTER STOCK FULL#
But, realistically, it's going to be two years until early '24, when we get the full '23 numbers and the analysts can choose a multiple. Therefore, I'm expecting cash profits of hundreds of millions a year quite quickly, with a valuation of 10 times EBITDA, meaning a capitalisation of several billions. IOW, relative peanuts for a serious fancier of the NFL or thoroughbreds. $4,200 equates to $81 a week, or $16 a day, if you bet 5 days per week. MGM/Entain say they expect positive EBITDA (real profits) sometime during '23, saying that they're spending an average of less than $300 for every long-term punter they're signing up.Īs always, I go back to hard numbers The average US "Hold" (profit on turnover) is 7%, meaning that once the punter wagers $4,200, the bookie will have won $300, recovered his acquisition costs and moved into profit. They're frightened by the enormous sums being spent on advertising & promotion to attract customers. The problem, imo, is a combination of uncertainty & a refusal by most PI's to believe any promises of 'jam tomorrow'. That said, I consider that the gloom around US gambling stocks in grossly overdone. The current market also stinks for practically all shares.
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RE: UK White Paper and US's Fox Corp Arbitration in June 25 May '22Ĭharlie, you wouldn't have an easier question to pitch at me, would you? The wonderfully effervescent market in gambling stocks from March '21 was, in hindsight, as OTT, as the current prices are downright pessimistic.