The hosts of Benzinga’s “SPACs Attack” held several SPAC Wars battles featuring companies that went public via SPAC merger competing in the same industry.
One of the high-profilebattleswasDraftkings Inc(NASDAQ:DKNG) versusRush Street Interactive Inc(NYSE:RSI), two companies operating in the online sports betting and online gaming sector.
DraftKings: Co-host Chris Katje highlighted DraftKings as the online sports betting company present in more states than any other competitor.
There are three online sports betting companies that operate in 10 or more states with DraftKings being the leader by a number of states.
“DraftKings is one of the best performing former SPACs out there,” Katje said.
DraftKings has a strong market share of No. 1 or No. 2 in many of its states including New Jersey, the most mature market, and Pennsylvania where it beats Barstool Sports andPenn National Gaming Inc(NASDAQ:PENN) in its home state.
DraftKingsreportedfirst-quarter revenue of $312 million, up 175% year-over-year and 1.5 million monthly unique players, up 114% year-over-year.
With FanDuel trading as a unit of OTC stockFlutter Entertainment ADR(OTC:PDYPY), DraftKings is a pure-play option for investors.
“DraftKings is the pure-play here, the market leader for investors to get excited about,” Katje said.
DraftKings expansion into media through a chief media officer, new acquisitions and investments could help the company grow its customer base, Katje added.
Rush Street Interactive: Strong analyst ratings and price targets for Rush Street Interactive could highlight how undervalued the company is, co-host Mitch Hoch said.
“You’re paying up for that DraftKings,” Hoch said highlighting the 5.4x revenue valuation for Rush Street Interactive compared to a double-digit multiple for DraftKings.
Revenue growth is expected to be higher in the future for Rush Street compared to peers, Hoch pointed out.
“The fundamentals are making sense,” he said.
Hoch also highlighted the international exposure Rush Street Interactive has with operations in Colombia.
“Rush Street focusing on profits,” Katje said. The host added that the smaller Rush Street could be an acquisition target to a larger player with its technology stack andexposureto several states.
The Winner: Viewers of “SPACs Attack” picked Rush Street Interactive as the winner in the battle.