RSI Stock Forecast & Price Target

Rush Street Interactive Inc. has demonstrated impressive financial performance, with revenues increasing by 34% year-over-year and EBITDA expanding 11-fold compared to the previous year, underscoring the effectiveness of its iGaming strategy. Additionally, the company reported a substantial 166% year-over-year growth in 4Q EBITDA, significantly surpassing consensus expectations, while both North and Latin American Monthly Active Users (MAUs) showed remarkable growth of 28% and 71% year-over-year, respectively. Looking ahead, Rush Street Interactive is well-positioned to capitalize on the expanding online gaming market, supported by favorable legislation and its dominant market share, suggesting a promising outlook for sustained growth and profitability.

Rush Street Interactive's outlook is negatively influenced by a projected decline in EPS due to increased interest expenses and disappointing market share trends that are worse than expected. The company's anticipated growth in sales and marketing expenditures for expansion into new markets, such as DE and Latin America, is offset by a forecasted decrease in these costs as a percentage of revenue by 2025. Furthermore, adverse regulatory impacts, such as Colombia's deposit VAT, coupled with the uncertainty surrounding the online sports betting and iGaming industries, are contributing to a cautious revenue estimate reduction for 2025.