Investor Michael Burry made tons of of thousands and thousands of {dollars} because the Nice Monetary Disaster unfolded by shorting subprime mortgages. This could result in his eventual portrayal within the movie “The Large Quick,” positioning him as a famed investor.
Burry’s hedge fund, Scion Asset Administration, is now defunct. Nonetheless, he stays part of the funding zeitgeist, offering his takes on varied belongings.
Notably, Burry lately made his opinion identified on probably the most beaten-down corners of the inventory market in 2026: on-line sportsbook shares.
The 2 most notable names on this area are and . DraftKings operates a sportsbook app by the identical title, whereas Flutter operates the app FanDuel.
Total, DraftKings is down greater than 20% on the yr, whereas Flutter has misplaced nearly half of its worth. Evidently, Burry thinks the market is unsuitable on these leisure names, lately choosing up shares of each.
The emergence of prediction markets like Kalshi and Polymarket has been an enormous driver of the decline in DraftKings and Flutter shares.
Nonetheless, Burry believes that Uncle Sam may have one thing to say about prediction markets, considerably weakening their aggressive menace.
Burry Reveals Sportsbook Buy Costs and Weighting
Burry says he lately bought shares of DraftKings at round $26 per share and of Flutter at round $107 per share. Shares stay very shut to those ranges. Burry says that his allocation between the 2 names is 40% DraftKings and 60% Flutter. It’s notable that Burry is allocating to each shares relatively than only one. This helps restrict company-specific threat, such because the potential that both firm’s administration staff makes poor choices that solely negatively affect their agency.
By this, Burry can wager on a normal restoration in on-line sportsbook shares with out placing all of his eggs in a single basket. Nonetheless, the slight obese to Flutter could merely mirror the truth that the inventory has fallen a lot more durable. Moreover, Flutter has proven a capability to higher convert the worth of the bets positioned on FanDuel into precise income in comparison with DraftKings.
Burry’s Rationale: Governments Will Come for Prediction Markets
Prediction markets present most of the identical capabilities as on-line sportsbooks, permitting customers to wager on the outcomes of occasions, together with sports activities. As a result of prediction markets provide “occasion contracts,” they’re federally regulated by the U.S. Commodity Futures Buying and selling Fee, relatively than by states like sportsbooks.
In flip, they’re technically authorized in all 50 states, though CBS Sports activities notes that prediction markets should not presently dwell in Michigan, Minnesota, or Nevada. In the meantime, solely 30 states provide on-line sports activities betting, as many states haven’t legalized these platforms. Moreover, prediction markets typically face considerably decrease taxes than sportsbooks.
Burry in the end believes that prediction markets will be unable to face this decrease stage of authorized scrutiny and taxation eternally. He says, “Prediction markets exist in a loophole adjoining to a closely regulated and taxed business. In time, prediction markets can be subsumed into regulation and taxation.”
Notably, in Q3 2021, states collected $190 million in tax income from sports activities betting nationwide. By Q2 2025, that determine had risen 382% to $917 million. With this, it’s not unreasonable to assume that Burry’s argument holds weight. If prediction markets take betting share from sportsbooks, states can lose out on this massive and rapidly rising income supply.
Wall Avenue Information Backs Burry’s Optimistic Outlook
Total, solely time will inform if Burry’s thesis that prediction markets will succumb to authorities intervention performs out. Well, DraftKings and Flutter are hedging for a actuality the place it doesn’t. Each corporations have rolled out their very own prediction market choices, probably permitting them to learn from progress on this area. Nonetheless, Burry’s thesis turning into a actuality can be preferrred. Kalshi and Polymarket should not have sportsbook platforms to fall again on if regulation crushes the prediction markets business, whereas DraftKings and Flutter do.
Notably, Wall Avenue analysts are inclined to agree with Burry that the market is undervaluing DraftKings and Flutter. The MarketBeat consensus value goal on DraftKings is $34.30, implying upside within the vary of 30%. In the meantime, the overwhelming majority of analysts have a Purchase ranking on the inventory. Out of 40 scores, DraftKings has 30 Buys, eight Holds, and two Sells.
From a value goal perspective, analyst bullishness is much more stark relating to Flutter. The MarketBeat consensus value goal on this title is $178.83, implying upside within the vary of 60%. Nonetheless, the scores breakdown is considerably much less favorable in comparison with DraftKings. Out of 29 scores, Flutter has 18 Buys, 9 Holds, and two Sells.
Authentic Submit
