Entain
Note: This is a daily stock update and the information stands true as of 28/09/26, 09:00 CET
Company Update:
Brazilian President Lula has issued a provisional measure banning fixed-odds sports betting and online casinos, effective immediately, following growing concerns over gambling-related household debt and addiction. The measure must be approved by Congress within 120 days, or it will lapse, while operators and industry groups are expected to challenge the ban.
Entain confirmed its 26 Group EBITDA guidance of £910-960m and Online EBITDA margin of 21-22% but now expects to be at the lower end of both ranges. Brazil was expected to contribute c.5% of FY26 Online NGR, but its EBITDA contribution was modest given the competitive market.
The news is most negative for Flutter and Entain, which have direct exposure to Brazil. Flutter is the most exposed, given its Betnacional business and Brazil’s growth potential.
The impact on FDJ United, Evolution and Allwyn/OPAP should be limited, while DraftKings and BetMGM have little direct exposure
In the US, the Sixth US Circuit Court ruled that Ohio and Tennessee can apply their gambling laws to its sports-event contracts, rejecting its argument that the contracts are exclusively subject to federal CFTC regulation. This follows similar state-friendly rulings in Nevada, while the Third Circuit previously sided with Kalshi in New Jersey, increasing the likelihood of Supreme Court review.
We see the ruling as positive for traditional sportsbooks, particularly Flutter/FanDuel and DraftKings, as it strengthens states’ ability to regulate prediction markets as gambling. However, the broader regulatory framework remains unresolved.
Expert Opinion:
Valuation for the sector is astoundingly low, whatever metric is used. But concerns remain about the structural risk that prediction markets will erode both top-line and margins of traditional sports betting players. And it will take time to get more visibility into the US legal stance on the matter. Equally important, fiscal or legal pressure may continue to rise, as shown in Brazil. We believe FDJ is probably the company least affected by these risks. It also pays a 10% dividend yield. FDJ is still a strong buy for us.
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