PENN Entertainment (NASDAQ:PENN) vs. Rush Street Interactive (NYSE:RSI) Financial Review

PENN Entertainment (NASDAQ:PENN) and Rush Street Interactive (NYSE:RSI) are both mid-cap consumer discretionary companies, but which is the superior stock? We will compare the two businesses based on the strength of their dividends, risk, analyst recommendations, profitability, institutional ownership, earnings and valuation.

Valuation & Earnings

This table compares PENN Entertainment and Rush Street Interactive”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
PENN Entertainment	$6.58 billion	0.37	-$311.50 million	($0.56)	-29.89
Rush Street Interactive	$924.08 million	4.67	$2.39 million	$0.20	94.43

Rush Street Interactive has lower revenue, but higher earnings than PENN Entertainment. PENN Entertainment is trading at a lower price-to-earnings ratio than Rush Street Interactive, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

PENN Entertainment has a beta of 1.6, indicating that its share price is 60% more volatile than the S&P 500. Comparatively, Rush Street Interactive has a beta of 1.87, indicating that its share price is 87% more volatile than the S&P 500.

Profitability

This table compares PENN Entertainment and Rush Street Interactive’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
PENN Entertainment	-1.12%	-4.36%	-0.85%
Rush Street Interactive	2.48%	16.53%	8.25%

Insider and Institutional Ownership

91.7% of PENN Entertainment shares are held by institutional investors. Comparatively, 24.8% of Rush Street Interactive shares are held by institutional investors. 2.7% of PENN Entertainment shares are held by company insiders. Comparatively, 56.9% of Rush Street Interactive shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Analyst Recommendations

This is a summary of recent ratings and price targets for PENN Entertainment and Rush Street Interactive, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
PENN Entertainment	2	6	10	0	2.44
Rush Street Interactive	0	4	8	0	2.67

PENN Entertainment currently has a consensus price target of $22.80, indicating a potential upside of 36.20%. Rush Street Interactive has a consensus price target of $19.33, indicating a potential upside of 2.37%. Given PENN Entertainment’s higher possible upside, equities research analysts plainly believe PENN Entertainment is more favorable than Rush Street Interactive.

Summary

Rush Street Interactive beats PENN Entertainment on 10 of the 14 factors compared between the two stocks.

About PENN Entertainment

PENN Entertainment, Inc., together with its subsidiaries, provides integrated entertainment, sports content, and casino gaming experiences. The company operates through five segments: Northeast, South, West, Midwest, and Interactive. It operates online sports betting in various jurisdictions; and iCasino under Hollywood Casino, L'Auberge, ESPN BET, and theScore Bet Sportsbook and Casino brands. The company's portfolio also includes PENN Play, customer loyalty program, which offers a set of rewards and experiences for business channels. In addition, it owns various trademarks and service marks, including Ameristar, Argosy, Boomtown, Hollywood Casino, Hollywood Gaming, L'Auberge, PENN Play, theScore, theScore Bet, theScore esports, and M Resort. The company was formerly known as Penn National Gaming, Inc. and changed its name to PENN Entertainment, Inc. in August 2022. PENN Entertainment, Inc. was founded in 1972 and is based in Wyomissing, Pennsylvania.

About Rush Street Interactive

Rush Street Interactive, Inc. operates as an online casino and sports betting company in the United States, Canada, Mexico, and rest of 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, PlaySugarHouse, and RushBet brands. Rush Street Interactive, Inc. was founded in 2012 and is headquartered in Chicago, Illinois.