Oppenheimer raises Rush Street stock price to $9 on “double-digit iGaming growth” from Investing.com

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On Thursday, Oppenheimer showed his confidence in Rush Street Interactive (NYSE:RSI) by increasing the company’s price target to $9.00 from $7.00 previously, while maintaining an “Outperform” rating on the stock. The decision followed Rush Street Interactive’s announcement of its first revenue and EBITDA forecast for 2024, which beat Wall Street expectations by 5% and $2 million, respectively.

The upward revision was attributed to robust double-digit growth in iGaming, better cost efficiency in customer acquisition and expansion of operations in Latin America.

The company highlighted the impressive performance of Delaware, where Rush Street Interactive generated $60 million in annual gross gaming revenue (GGR) in its first two months of operation alone. This success was seen as a testament to the company’s high-quality user experience. Additionally, the company expressed optimism about Rush Street Interactive’s ability to maintain stable market share despite a competitive advertising environment, indicating a strong loyalty base among its core users.

The analyst pointed to the successful scaling of operations in Colombia and Mexico, which are seen as an indicator of the company’s potential in the broader Latin American market. Oppenheimer’s updated financial model projects Rush Street Interactive’s EBITDA to double by 2025.

Still, the company’s stock currently trades at 14 times Oppenheimer’s 2025 EBITDA estimate, meaning the market may not fully appreciate the company’s consistent top-5 iGaming market share and the prospects for iGaming legislation .

In summary, Oppenheimer’s maintained Outperform rating reflects a positive outlook for Rush Street Interactive’s future financial performance and market position. The company’s analysis suggests that Rush Street Interactive is well positioned for further growth and expansion, particularly in the iGaming sector and emerging markets such as Latin America.

Investing Pro Insights

Given Oppenheimer’s recent analysis of Rush Street Interactive (NYSE:RSI), certain metrics from InvestingPro paint a detailed financial picture of the company. With a market cap of $484.12 million, the company’s financial health and stock performance can be better understood using these real-time data points. The price-to-book value (P/E) ratio for the trailing twelve months through the third quarter of 2023 is 23.26, which is relatively high and may reflect investors’ confidence in the company’s assets despite the lack of profitability over the same period. Additionally, the company’s revenue growth continues to be strong, recording an increase of 18.95% over the last twelve months (as of Q3 2023).

InvestingPro Tips suggests that Rush Street Interactive holds more cash than debt on its balance sheet, which provides a degree of financial stability. However, analysts do not expect the company to be profitable this year. The stock has also experienced significant volatility, with the price’s total return falling by 7.86% over the past week, but posting a strong return over the past three months, with an increase of 39.64%. These moves suggest a potentially opportunistic situation for investors comfortable with higher risk.

For those who want to dive deeper into Rush Street Interactive’s financial metrics and stock performance, InvestingPro offers additional tips that can help guide investment decisions. Readers can learn more by visiting https://www.investing.com/pro/RSI and using the coupon code PRONEWS24 to receive an additional 10% discount on an annual or two-year Pro and Pro+ subscription. With 9 additional InvestingPro tips, investors can gain a more comprehensive understanding of the company’s financial condition and market potential.

This article was created with the assistance of AI and reviewed by an editor. More information can be found in our terms and conditions.

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