RSI Stock Forecast & Price Target

Rush Street Interactive Inc. reported a remarkable 34% year-over-year revenue growth, accompanied by an EBITDA increase that was 11 times greater than the prior year, underscoring the effectiveness of its iGaming-centric strategy. The company also demonstrated significant momentum in user acquisition, with North American monthly active users (MAUs) rising 28% and Latin American MAUs increasing 71%, indicating robust market expansion in these key regions. Additionally, Rush Street Interactive's dominant market position and favorable legislative changes point toward a promising future for both online sports betting (OSB) and iGaming, suggesting sustained revenue growth and improved operational margins.

Rush Street Interactive Inc. faces a challenging outlook primarily due to a projected decline in earnings per share attributed to rising interest expenses. Despite expectations for increased sales and marketing expenditures to pursue growth opportunities, the company anticipates a decrease in these expenses as a percentage of revenue by 2025, indicating potential inefficiencies. Furthermore, negative market share trends, particularly following a slight EBITDA miss during FQ1, along with unfavorable regulatory conditions like Colombia's deposit VAT, suggest that the company's growth potential in the online sports betting and iGaming industries may be overestimated.