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Rush Street Interactive (RSI)
NYSE:RSI
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Rush Street Interactive
(NYSE:RSI)
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Rating:73Outperform
Price Target:
$20.50
▲(2.76% Upside)
Action:ReiteratedDate:02/19/26
The score is driven primarily by strong financial improvement (profitability and cash flow strength with minimal leverage) and upbeat 2026 guidance. Offsetting factors are a mixed technical picture (negative MACD and trading below key mid-term averages) and a stretched valuation (high P/E with no dividend support).
Positive Factors
Strong cash balance & generation
A $336M cash balance and $142M net cash generation in 2025 provide durable liquidity and financial optionality. Minimal leverage plus strong cash flow supports continued market entry, product/content investment, share repurchases, and resilience through regulatory or revenue-cycle variability.
Multi-year revenue scaling and profitability
Scaling from ~$278M (2020) to $1.134B (2025) with a return to profitability signals the business model maturing. Robust operating and free cash flow that nearly match net income indicate earnings quality and provide durable funding for growth, reinvestment, and partner obligations.
Broad-based user growth and market expansion
Large MAU gains across North America and Latin America and product expansion (poker rollouts, planned Alberta launch) create durable scale and cross-sell opportunities. Multi-jurisdiction presence diversifies revenue sources and strengthens unit economics as retention and content depth improve.
Negative Factors
Colombia tax/regulatory uncertainty
A potential 19% revenue tax in Colombia represents a structural earnings risk in a high-growth market. If upheld, it materially alters unit economics, could force continued heavy bonusing or price changes, and reduces long-term profitability and ROI on expansion in the region.
ARPMAU/player-value compression
Declining ARPMAU from rapid user acquisition and bonus-led retention indicates weaker per-user economics. Persistently lower player value can cap margin expansion, necessitate sustained promotional spend to retain customers, and make profitable scale harder to maintain over multiple quarters.
Planned increases in marketing and G&A
Materially higher marketing and G&A outlays raise execution risk: if incremental spend fails to deliver proportionate retention or yield, operating leverage could reverse. Sustained higher SG&A could limit net margin improvement and pressure future cash flow conversion.
Rush Street Interactive (RSI) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$4.64B
Dividend YieldN/A
Average Volume (3M)2.55M
Price to Earnings (P/E)70.5
Beta (1Y)1.01
Revenue Growth23.15%
EPS GrowthN/A
CountryUS
Employees883
SectorConsumer Cyclical
Sector Strength84
IndustryGambling, Resorts & Casinos
Share Statistics
EPS (TTM)0.08
Shares Outstanding103,175,026
10 Day Avg. Volume2,730,180
30 Day Avg. Volume2,549,059
Financial Highlights & Ratios
PEG Ratio0.05
Price to Book (P/B)12.65
Price to Sales (P/S)1.64
P/FCF Ratio11.34
Enterprise Value/Market Cap1.15
Enterprise Value/Revenue4.70
Enterprise Value/Gross Profit13.58
Enterprise Value/Ebitda41.17
Forecast
1Y Price Target
$24.25Price Target Upside21.55% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering8
EPS Forecast (FY)0.53
Revenue Forecast (FY)$1.32B
Rush Street Interactive Business Overview & Revenue Model
Company DescriptionRush Street Interactive, Inc. operates as an online casino and sports betting company in the United States and Latin America. It provides real-money online casino, online and retail sports betting, and social gaming services. In addition, the company offers full suite of games comprising of bricks-and-mortar casinos, table games, and slot machines. The company markets its online casino and sports betting under BetRivers.com, PlaySugarHouse.com, and RushBet.co brands. Rush Street Interactive, Inc. was founded in 2012 and is headquartered in Chicago, Illinois.
How the Company Makes MoneyRush Street Interactive generates revenue primarily through online sports betting and casino gaming. The company earns money by taking a percentage of wagers placed on its platforms, known as the 'hold' or 'vig,' which is the difference between the total amount wagered and the winnings paid out. Key revenue streams include sports betting, where customers place bets on various sporting events, and casino gaming, which encompasses a range of games such as slots, table games, and live dealer experiences. Additionally, RSI benefits from partnerships with various sports leagues and teams, as well as collaborations with third-party technology providers that enhance its offerings and expand its market reach. The company also focuses on customer acquisition through promotions and bonuses, driving user engagement and increasing its revenue potential.
Rush Street Interactive Key Performance Indicators (KPIs)
Any
Revenue by Geography
Breaks down revenue across different regions, revealing where the company is strongest and where it may face risk or growth potential due to local economic conditions or market share shifts.
Breaks down revenue across different regions, revealing where the company is strongest and where it may face risk or growth potential due to local economic conditions or market share shifts.
Data provided by:
The Fly
The FlyRush Street Interactive Earnings Call Summary
Earnings Call Date:Feb 17, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:May 06, 2026
Earnings Call Sentiment Positive
The call presented a strongly positive operational and financial picture: record revenue, substantial adjusted EBITDA and net income growth, broad-based MAU expansion, improved operating leverage and a confident 2026 guidance range. The primary negatives are regulatory and tax-related uncertainty in Colombia (which materially affected 2025 via $75M of bonusing and is assumed conservatively in 2026 guidance), ARPMAU dilution from rapid new-user growth, and evolving competitive/regulatory dynamics around prediction markets. Overall, the positives (strong growth, profitability, cash generation and clear growth initiatives) materially outweigh the manageable but notable risks, leading to a constructive outlook.Q4-2025 Updates
Positive Updates
Record Annual Financial Performance
Full year 2025 revenue of $1.13 billion, up 23% year-over-year, exceeding the high end of raised guidance; adjusted EBITDA of $153.7 million, up 66% YoY and above guidance; net income of $74 million vs $7.2 million in 2024.
Strong Fourth Quarter Results and Revenue Momentum
Q4 2025 revenue of $324.9 million, up 28% YoY, marking the 11th consecutive quarter of sequential revenue growth; Q4 adjusted EBITDA of $44.1 million, up 44% YoY and a new quarterly record.
Robust User Growth and Engagement
North America MAUs grew 37% YoY to over 278,000 in Q4; North American online casino MAUs grew 51% YoY in Q4; Latin America MAUs grew 47% YoY to over 493,000 in Q4, demonstrating broad-based user expansion.
Improving Operating Leverage and Margins
Full-year gross margin of 34.6% (Q4 34.4%) while marketing spend as a percentage of revenue declined ~290 basis points YoY; marketing was 14% of revenue (Q4 marketing $45.4 million, +5% YoY) and G&A improved to 7.1% of revenue for the year (down from 8.1%).
Successful Navigation and Market Share Gains in Colombia
Despite temporary VAT on deposits in 2025, company achieved Colombia GGR growth of 66% for the year and increased MAUs by 34% while strategically absorbing much of the tax impact via bonusing to preserve engagement and share.
Solid Balance Sheet and Cash Generation
Ended the year with $336 million in cash on hand and generated $142 million of cash during 2025 net of stock repurchases; $42 million remaining on the $50 million share repurchase program.
Confident 2026 Guidance and Growth Outlook
2026 guidance: revenue $1.375–1.425 billion (21%–26% YoY growth) and adjusted EBITDA $210–230 million (37%–50% YoY growth); management expects revenue and EBITDA cadence to improve through the year and modest gross margin improvement.
Product and Market Expansion Initiatives
Plans to increase investment in differentiated casino content; anticipated Alberta launch potentially late Q2/early Q3 2026; poker expansion—launched in 4 states with plans for a 5th—to enhance retention and cross-sell.
Negative Updates
Colombia VAT Deposit Tax Impacted 2025 Revenue and EBITDA
The temporary 2025 VAT on deposits led to approximately $75 million of incremental bonusing (direct revenue reduction) and an estimated $25–30 million EBITDA cost for the year.
Compression in Player Value (ARPMAU)
North America ARPMAU declined 5% YoY in Q4 due to dilution from rapid user additions; Latin America ARPMAU declined 21% YoY in Q4 largely driven by extra bonusing in Colombia.
Regulatory and Tax Uncertainty in Colombia for 2026
A new emergency decree implemented a 19% VAT on revenue for 2026 (assumed in guidance), though the Constitutional Court suspended the decree pending review—creating uncertainty; company expects at least January tax payment before suspension.
Assumed 19% Revenue Tax in 2026 Guidance Increases Risk
Guidance prudently assumes the 19% tax on revenue will be in place for full year 2026, which could materially affect profitability in the region if upheld (impact described as lower than 19% net due to variable costs but still meaningful).
Prediction Markets: Competitive and Regulatory Ambiguity
Prediction markets are an evolving competitive factor with active legal/regulatory developments (e.g., recent court rulings); while management is monitoring closely and not prioritizing it now, it represents an uncertain competitive landscape.
Planned Increase in Marketing and G&A Investment
Management expects meaningful increases in marketing spend in 2026 (though slower than revenue growth) and G&A to grow more closely with revenue as investments in content, lobbying and personnel accelerate—which could pressure near-term operating leverage if outcomes differ from plan.
Company Guidance
The company guided 2026 revenue to $1.375–$1.425 billion (up ~21%–26% YoY) and adjusted EBITDA to $210–$230 million (up ~37%–50% YoY), noting cadence should improve through the year; guidance assumes the new 19% Colombia tax on revenue is in place for the full year (the decree was suspended but January will be paid). Management framed the outlook off a 2025 base of $1.13 billion revenue (+23% YoY) and $153.7 million adjusted EBITDA (+66% YoY), Q4 revenue of $324.9 million (+28% YoY), FY gross margin ~34.6% (Q4 34.4%), cash of $336 million, $142 million cash generation in 2025 (net of repurchases), ~$42 million remaining on a $50 million buyback, Q4 marketing $45.4 million / FY marketing $158.4 million (~14% of revenue, down 290 bps YoY), and FY G&A $81 million (~7.1% of revenue); they expect modest gross margin improvement, meaningful (but revenue‑outpacing) increases in marketing, G&A to grow more in line with revenue, and did not include potential upside from an Alberta launch in the guidance.Rush Street Interactive Financial Statement Overview
Summary
Strong multi-year turnaround with revenue scaling to $1.134B (2025), a return to profitability in 2024–2025, and robust cash generation (2025 operating cash flow ~$165M; free cash flow ~$164M). Balance sheet is low-risk with essentially no debt and improving equity, though margins remain relatively modest and prior-year volatility is a durability watch item.Income Statement
Revenue has scaled materially from $278.5M (2020) to $1.134B (2025), with growth re-accelerating in 2025 (6.6% vs. near-flat in 2024). Profitability has improved sharply: the business moved from large operating losses in 2021–2023 to solid profitability in 2024–2025, with 2025 showing ~7.7% operating margin and ~2.9% net margin. Gross margin has been relatively steady in the low-to-mid 30% range, supporting the earnings turnaround. The main weakness is that net profitability remains modest for the industry and the company’s earnings power is still proving itself after several loss years.78
Positive
Balance Sheet
The balance sheet looks conservatively positioned with essentially no leverage (total debt $0 in 2025; very low debt in prior years), which reduces financial risk and improves flexibility. Equity has expanded meaningfully (from ~$78.7M in 2024 to ~$147.2M in 2025), and 2025 profitability translated into a strong return on equity (~22.6%). The key watch-out is the historical volatility in equity (including negative equity in 2020) and that asset growth has been significant, so maintaining returns through the cycle remains important.86
Very Positive
Cash Flow
Cash generation strengthened substantially: operating cash flow rose to ~$165.0M in 2025 from ~$106.4M in 2024, and free cash flow jumped to ~$164.2M (up ~64.5% in 2025). Cash conversion is very strong, with free cash flow nearly matching net income in 2025, indicating earnings are backed by cash. The primary weakness is historical volatility—cash flow was negative in 2021–2023—so durability across different operating environments remains the key risk.88
Very Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 1.13B | 924.08M | 691.16M | 592.21M | 488.11M |
| Gross Profit | 392.76M | 322.05M | 226.15M | 177.55M | 155.96M |
| EBITDA | 127.39M | 56.51M | -21.85M | -110.47M | -90.03M |
| Net Income | 33.31M | 2.39M | -18.30M | -38.63M | -29.06M |
Balance Sheet | |||||
| Total Assets | 658.51M | 379.47M | 318.58M | 350.35M | 408.73M |
| Cash, Cash Equivalents and Short-Term Investments | 340.50M | 229.17M | 168.33M | 206.08M | 281.03M |
| Total Debt | 18.46M | 4.64M | 4.13M | 1.90M | 1.66M |
| Total Liabilities | 355.02M | 181.15M | 152.45M | 159.47M | 101.03M |
| Stockholders Equity | 147.24M | 78.68M | 53.77M | 56.05M | 85.44M |
Cash Flow | |||||
| Free Cash Flow | 164.24M | 77.02M | -37.12M | -88.62M | -82.94M |
| Operating Cash Flow | 165.00M | 106.45M | -5.93M | -60.32M | -48.19M |
| Investing Cash Flow | -37.02M | -33.36M | -33.78M | -28.99M | -37.00M |
| Financing Cash Flow | -37.36M | -2.65M | -518.00K | -1.22M | 125.58M |
Rush Street Interactive Technical Analysis
Positive
19.95
Price Trends
18.48
Positive
18.34
Positive
17.70
Positive
Market Momentum
0.42
Negative
64.61
Neutral
85.34
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For RSI, the sentiment is Positive. The current price of 19.95 is above the 20-day moving average (MA) of 17.95, above the 50-day MA of 18.48, and above the 200-day MA of 17.70, indicating a bullish trend. The MACD of 0.42 indicates Negative momentum. The RSI at 64.61 is Neutral, neither overbought nor oversold. The STOCH value of 85.34 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for RSI.
Rush Street Interactive Risk Analysis
Rush Street Interactive disclosed 63 risk factors in its most recent earnings report. Rush Street Interactive reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Rush Street Interactive Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
73 Outperform | $4.64B | 70.54 | 29.49% | ― | 23.15% | ― | |
73 Outperform | $5.53B | 24.57 | 32.35% | 1.34% | 29.54% | 4389.69% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
61 Neutral | $21.10B | ― | 0.45% | ― | 18.51% | 37.25% | |
56 Neutral | $367.95M | 68.92 | 23.16% | ― | 1.79% | ― | |
43 Neutral | $667.62M | -1.72 | -114.88% | ― | 0.36% | 47.55% |
* Consumer Cyclical Sector Average
RSI
Rush Street Interactive
19.95
8.66
76.71%
DKNG
DraftKings
23.82
-17.48
-42.32%
SGHC
Super Group (SGHC)
11.02
4.32
64.40%
CDRO
Codere Online
8.08
0.50
6.56%
BALY
Bally's Corporation
13.58
-3.42
-20.12%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.