Up Nearly 60% in the Past Month, is Rush Street Interactive Still a Buy? By StockNews
The shares of Rush Street Interactive, an online casino company (RSI), have jumped nearly 60% in the last month due to the expansion of its market. But can this stock rally in spite of increased competition within the rapidly growing industry? Let’s find out.Online casino and sports betting company Rush Street Interactive, Inc. (RSI) made its stock market debut last December, going public via special purpose acquisition company (SPAC) dMY Technology Group, Inc. The stock has gained 59.7% in price over the past month to close yesterday’s trading session at $19.28, thanks to a series of positive developments for the company. RSI, for instance, became the only official partner in sports betting of Magic City Jai-Alai on September 20. RSI’s BetRivers.com, and PlaySugarHouse.com both launched their own branded live casino studios earlier in the month for New Jersey and Pennsylvania players. The stock is down nearly 11% since the beginning of this year.
Sports betting stocks such as RSI will be more popular now that the NFL season has begun. However, RSI is up against strong competition from the rest of the industry. SPACs face increasing scrutiny from regulators. Woodruff Sawyer data shows that shareholder lawsuits against SPACs after mergers increased to fifteen in the first half 2021. This is three times as many than were filed in 2020. According to CFO Dive, SPAC initial public offerings plunged 87% in the second quarter. RSI might also be adversely affected.
The second quarter saw losses for the company. Hedge fund interest declined in recent quarters. So, RSI’s near-term prospects don’t look very promising.
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