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Is Flutter Entertainment a Falling Knife—or a Rare Contrarian Setup?
Submitted by Sam Quirke. Article Published: 2/9/2026.
In Brief
- Shares of Flutter have slid more than 50% from last summer’s highs, erasing three years of gains.
- Structural concerns remain, but the stock’s technicals are now deeply oversold and near long-term support.
- Bullish analysts argue the selloff has gone too far relative to the company’s long-term opportunity, with some calling for as much as 50% upside.
After months of steady selling and an acceleration since early January, shares of Flutter Entertainment plc (NYSE: FLUT) are back at the levels they traded at in 2020. The stock has effectively given up three years’ worth of gains — a brutal outcome for what was once viewed as one of the most exciting names in global online gambling.
This has not been a single-event collapse. Rather, it's been a grinding loss of confidence as investors reassess competition, profitability and long-term potential. The result is an ugly-looking chart that is beginning to attract contrarian attention. Is there an argument that the worst-case scenario is already priced in? Let’s take a closer look.
Why the Selloff Has Been So Severe
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Discover how to invest in the fund Trump uses to collect this income >>The drivers behind the multi-month decline are varied. First, investors are increasingly concerned about the rise of pure-play prediction market entrants and what that could mean for Flutter’s core sportsbook business. The fear is not just intensified competition, but margin pressure and a potential shift in how betting markets operate.
Second, investors remain frustrated by Flutter’s unclear path to consistent profitability, an issue many high-growth tech companies are facing. Despite strong top-line growth, the market has grown impatient with the lack of clear timelines and visibility on when scale will turn decisively into earnings leverage.
Third, competition remains fierce. Rivals such as DraftKings Inc. (NASDAQ: DKNG) continue to spend aggressively, keeping acquisition costs elevated and limiting the potential for margin expansion.
Put together, it’s perhaps not surprising that investors have been spooked.
Why This Might Be the Falling Knife Worth Catching
Despite the risks, the current risk/reward profile is beginning to look attractive. From a technical perspective, Flutter is deeply oversold, with momentum indicators at extreme levels. The stock is also trading around a major long-term support zone near $150, a level that has historically attracted buyers. Those conditions don't guarantee a full reversal, but they do increase the likelihood that selling pressure could exhaust itself soon.
Fundamentally, the business remains stable. Core revenue engines remain healthy, particularly the U.S. iGaming segment, which continues to grow strongly year over year. That segment provides a more stable, higher-margin foundation and is becoming an increasingly important part of the bullish long-term thesis.
Flutter is also making strategic investments in prediction markets instead of ignoring the threat. While those initiatives add short-term uncertainty, they should ultimately help the company defend market share and participate in the industry's evolution rather than be disrupted by it. The key question now is whether the worst-case scenario is already priced in. After approximately a 50% drawdown and a return to 2020 prices, it’s a fair question.
Analysts Are Still Backing the Long-Term Story
While the market has been ruthless, analyst support has held up far better than the share price would suggest. Recent weeks have seen Buy ratings reiterated by firms such as Canaccord Genuity, Stifel Nicolaus, Oppenheimer and Barclays, to name a few.
Fresh price targets from this group extend as high as the low $300s, implying substantial upside potential given the stock is trading below $150.
Analysts are not blind to near-term challenges. Instead, they emphasize Flutter’s global scale, diversification across markets and long-term growth prospects in regulated online gambling.
Improved visibility around its prediction-market initiatives is also viewed as a potential catalyst for restoring confidence.
Whenever there’s such a gap between analyst estimates and market pricing, contrarians tend to take notice.
How to Think About Flutter From Here
For now, this is not yet the clean dip-buying setup some investors might hope for. The concerns around competition and profitability are real, and Flutter still has work to do to prove it can fully capitalize on a large market opportunity.
At the same time, the stock feels priced to fail. With technicals washed out, support being tested and sentiment extremely negative, the conditions are in place for a sharp recovery if selling pressure subsides. If Flutter can begin to consolidate above $150, the setup could quickly shift from a falling knife to a high-risk, high-reward recovery play.
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