Rush Street Interactive, Inc. (RSI): A Bull Case Theory

Core Thesis - Rush Street Interactive, Inc. (RSI) is positioned as a strong investment opportunity due to its innovative AI-driven platform and significant growth in user engagement, particularly in Latin America [1][2][5]. Company Overview - RSI's share price was $18.77 as of January 13th, with trailing and forward P/E ratios of 72.19 and 36.10 respectively [1]. - The company operates in multiple markets including the U.S., Canada, Mexico, Colombia, and Peru, focusing on personalized gaming experiences [2]. Market Position - RSI has established early market access in key North American states such as Pennsylvania, West Virginia, Michigan, New Jersey, and Ontario, while holding a dominant presence in Latin America [3]. - Monthly active users have increased by 46% year-over-year in the U.S. and Canada, and by 30% in Latin America, indicating strong user engagement [3]. Financial Performance - RSI reported a 20% year-over-year revenue growth, with no debt, $88.9 million in free cash flow, and a cash balance of $273 million [3]. - The company's trailing twelve-month revenue is approximately $1 billion, with a total addressable market in Latin America estimated at $28.9 billion [4]. Regulatory Environment - Recent regulatory developments in Colombia, including the rejection of a proposed 19% online gambling VAT, have removed a potential margin headwind, strengthening the investment case for RSI [4]. Growth Potential - RSI's valuation stands at $4.3 billion, suggesting substantial upside potential driven by user growth, regional expansion, and its unique AI-driven strategy [5]. - The company is actively pursuing expansion into Brazil, Argentina, and Chile, further tapping into the Latin American market [4].