Flutter (FLTR 29s; Ba1/BBB- Pos/BBB) $5b buyback
> So its announcing a $5b buyback programme over the next 3-4yrs (looks like the inaugural). Reminder this is a co that has thus far limited equity pay-outs and instead used cash on M&A. It's a slight credit negative but it has kept leverage target unch at 2-2.5x (we have doubts on how seriously it takes it though) and said buybacks will happen provided leverage is within target or expected to be in the near term.
> Raters have cleared it after its recent acquisition spree (totalling $2.95b). Leverage on FY EBITDA guidance will move to net 2.9x, leaving limited potential for sizeable buybacks in near-term (or we would hope). Reminder it reports ex. leases - including it will be net 3.1x levered.
> It's also given some 3yr or 2027 growth targets including group revenue to CAGR 14% to $21b, adj. EBITDA >$5b (guidance this year is $2.5b at the midpoint) helped by margin expansion of +700bps to 25%. FCF to CAGR 36% to $2.5b.
We have generally been skewed to see value in the €29s (2.5yr duration on high cash px) given the fast growth it is riding. We do expect supply (across $ and €) in the near-future and might be worth waiting that out for a potential NIC (will hold onto Moody's Ba1 rating for now).
Presser here