JP Morgan and Citi Identify Undervaluation in Entain and Flutter After Sharp 2026 Share Price Declines
JP Morgan sees Entain as undervalued after a 45% drop with a £9.65 target implying over 120% upside. Citi upgraded Flutter to buy after a 62% decline, with consensus targets at $133 for 63% gains. Both flag Brazil and UK tax risks but cite operational gains and scale as recovery drivers.
SCCG Take — Scale allows these operators to absorb tax and regulatory costs that pressure smaller rivals, yet Brazil’s unresolved framework remains the binding variable for sustained investor confidence.
City analysts have identified undervaluation at Entain and Flutter Entertainment after both operators recorded steep share price drops in 2026 trading. JP Morgan described Entain’s 45% decline as unjustified given improving fundamentals and reiterated an overweight rating. Citi upgraded Flutter from neutral to buy despite a tumble. The assessments highlight operational resilience and market share potential even as regulatory risks persist in Brazil and the UK.
JP Morgan’s Case for Entain Rebound
JP Morgan lowered its target price from £10.50 to £9.65 to account for possible Brazil setbacks and a UK Machine Games Duty increase to 40%. That target still implies over 120% upside from the current share price near £4.31. The bank expects Entain to gain share from smaller operators in a margin-squeezed market.
Entain delivered UK and Ireland iGaming revenue growth of 13% in the first half even after tax liabilities doubled to £50m. Stella David, chief executive, indicated a doubled Machine Games Duty would contribute to 1,500 sector-wide shop closures. Corporate debt of £3.6bn is set to decline following the sale of Entain CEE to EMMA Capital. These elements support a reversal from the post-£22 peak seen in September 2021.
Flutter’s Position and Analyst Consensus
Citi analyst Monique Pollard cited Flutter’s scale and brand strength in the upgrade. The owner of FanDuel, Paddy Power, Sky Bet and Betfair saw its shares fall as low as $74 before trading at $81.58. Data from 33 analysts produces an average target of $133, a 63% increase on current levels.
Kenneth Dart has built an approximate 31.4% economic interest. Outgoing chief executive Peter Jackson stated that UK tax increases give Flutter “a really good opportunity to substantially increase market share”. Chief financial officer Rob Coldrake pointed to gains in Italy and Turkey through the SISAL brand, while Brazil plans remain on hold. Last year’s $500m impairment from terminating Junglee in India underscores the retrenchment risk.
According to reporting by SBC News, analysts at both banks conclude the listed operators have absorbed excessive share price pressure relative to their underlying momentum. The outcome in Brazil and final UK budget decisions will test whether that optimism holds.
Reporting: SBC News
Generated by SCCG’s automated editorial system from published source reporting. SCCG Management holds editorial responsibility.
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