Flutter Entertainment (FLUT) could benefit from a US Supreme Court ruling in favor of New Jersey state that would strip prediction markets of their federal protection, Wedbush Securities said in a note Thursday.
New Jersey has petitioned the Supreme Court to decide whether prediction markets can offer sports contracts without following state gambling laws. Competition concerns that have weighed on Flutter shares are expected to ease if the Supreme Court takes up the petition and decides in favor of the state, the brokerage said.
However, Wedbush said the outcome of any case is uncertain and it does not expect a resolution any time soon. Even with a favorable ruling, Congress could move to codify or outright ban sports contracts, according to the note.
The brokerage said Kalshi's growth will likely remain an overhang on Flutter Entertainment's shares through the 2026 to 2027 National Football League season and into mid-2027.
Wedbush Securities has an outperform rating on Flutter, with a $126 price target.
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