Rush Street Guidance Went Up-Is RSI Still Rich at 93x Earnings?

Raised guidance removed the easy fear, but valuation is now the real debate

Rush Street's latest quarter and guidance update solved one problem and exposed another. The business still looks like it can grow fast, but after a guidance raise, the stock no longer has much room for a stumble.

The growth scare faded quickly

Investors were mainly asking whether Rush Street could keep growing fast enough. Q2 did not leave much doubt: revenue reached $393.78 million, up 46.3% year over year, and management followed up with a full-year guidance raise. That removes the simplest bear case that growth had suddenly stalled.

A premium multiple now has to keep earning itself

That is also what makes the valuation debate tougher. RSI still trades at roughly 92.79x earnings, while screen readers also show about 90.76x. The stock also sits near the top of its 52-week range. Bulls can argue that a rich multiple is acceptable if earnings keep compounding quickly, especially with coverage from 31 analyst firms and a latest Macquarie target of $35.00. But when a stock already trades at about 93x earnings, merely "good" may not be enough.

What the operating momentum looks like on the ground

The next question is whether this growth is being driven by real product demand or just heavier spending. The available evidence points to a business that is still gaining traction.

User acquisition and casino mix both improved

Rush Street reported record player acquisition, with monthly active users in North America growing 46%. That kind of user growth is hard to sustain if the product is weak or engagement is shallow.

The revenue mix also matters. Q2 included a 40% increase in online casino revenue, and management has described a casino-first approach as the main value driver. Sports can be more event-driven, while casino can support more regular play. If that mix keeps improving, customer habits and lifetime value may strengthen over time.

The growth is showing up across several markets

This does not look like a one-market spike. Management said it expanded market share in North American iCasino jurisdictions by about 90 basis points sequentially, while Delaware, Michigan, and New Jersey all posted strong casino growth in Q2. In Latin America, Mexico has also become a meaningful accelerator.

That broader footprint matters. It suggests the platform can compete against larger rivals and is not relying on a single state or a temporary tailwind.

Why the multiple still matters even if the business is improving

The business looks healthier, but that does not automatically make the stock cheap. Rush Street is expected to grow earnings next year from $0.50 to $0.65 per share. If that happens, the current multiple becomes easier to defend because earnings are catching up to price.

What to watch before the next report: - Bullish sign: iCasino share gains continue and Latin America keeps contributing. - Bearish sign: casino momentum cools or a few key states lag after a broad Q2. - Key test: whether the EPS path from $0.50 to $0.65 still holds.

Is RSI rich or reasonable after the guidance raise?

My read is that RSI still looks rich, but not irrational. After the full-year guidance raise, the operating story became easier to like. The stock story became harder, because RSI is still near the top of its 52-week range and the next scheduled earnings update is listed for Oct. 28, 2026. In other words, this is a proof-as-you-go stock, not a settle-it-now story.

What would keep the bull case intact

Bulls do not need perfection. They need evidence that product demand, player acquisition, and the casino mix are still improving in the coming quarters.

What could break the setup

The bear case is simpler. If momentum slows, a stock already trading near the top of its range can de-rate quickly because much of the good news may already be in the price.

RSI still looks like a growing business with an expensive stock, not a broken company. That is a meaningful difference, but it does not remove the need for continued execution.