(Alliance News) - Entain PLC and Flutter Entertainment PLC are benefitting from rising momentum in the US, a burgeoning gambling market, Citi said on Tuesday.
Brands such as Entain's Ladbrokes and Flutter's SkyBet are among market leaders in the UK gambling space. The FTSE 100-listed parents are now making tilts at expanding in the US.
Sports betting is being legalised in many states for the first time following a Supreme Court ruling in 2018, allowing UK bookmakers - experienced in sports betting - to tap into the lucrative market there.
"We are increasingly bullish on the size of the US prize," analysts at Citi said.
The investment bank forecasts a long-term earnings opportunity of USD9.3 billion, double its estimate from last year.
Citi added: "The revenue generated in states that are open is more than we had predicted, a greater number of states have launched/proposed regulation for online sports betting than we had forecast.
"Further, we expect Flutter and Entain's dominance to continue."
In the US, Entain owns one half of the BetMGM joint-venture, alongside MGM Resorts International. Flutter, meanwhile, operates FanDuel, a provider of sportsbook and fantasy sports services.
Citi double-upgraded Flutter to Buy from Sell and maintained its Buy recommendation for Entain.
Flutter shares were 1.9% higher at 11,350.00 pence each in London on Tuesday afternoon. Entain shares were up 1.5% at 1,691.50p.
By Eric Cunha; ericcunha@alliancenews.com
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