After trading activity comes to a halt on Wednesday, fuboTV (FUBO) will take its turn to deliver Q4’s financials.
For streaming companies, this earnings season has been nothing less than a massacre, as evidenced in the share price meltdown following Netflix’ and Roku’s disastrous displays.
Can the sports-first streamer be an exception to the rule? Wedbush’s Michael Pachter is uncertain, although, for the analyst, that doesn’t alter the long-term bull thesis.
“While fuboTV is an unlikely outlier in the great streaming sell-off, and is therefore at risk of further sell-off in the near-term, we continue to have a favorable long-term view,” said Pachter ahead of the print. “fuboTV’s comprehensive entertainment and sports offering is a real differentiator, and its focus on the sports viewer/bettor should serve to accelerate subscriber growth, particularly as it expands exclusive content and continues to roll out its Gaming offering in 2022 and beyond.”
FUBO already gave an idea of what’s on offer when it delivered Q4 preliminary revenue and subscriber metrics in January. As has become customary, these were excellent, but importantly the company did not announce earnings and with the company’s track record of huge losses, Pachter believes this “puts the company at risk of a sell-off on its Q4:21 report, as it likely spent handsomely in Q4 to build its Sportsbook and content offering, not to mention its acquisitions.”
These acquisitions include that of France’s leading live TV streaming company, Molotov, which closed in Q4. The addition shows the company is not only focused on expanding its product offering but has also set its sights on increasing the global footprint. “While that extends the road to profitability,” Pachter noted, “we think it increases the scale of future profitability.”
So, what does this all mean for investors? Pachter reiterated an Outperform (i.e., Buy) rating, but given the company is a way off profitability, reduced the price target from $32 to $19. Nevertheless, with the stock down by 80% over the past year, the figure suggests shares will rise by 126% in the year ahead. (To watch Pachter’s track record, click here)
Most on the Street believe the stock has more upside. The average target stands at $21.20, suggesting gains of ~165% are on the horizon. Overall, with the ratings split 5 to 1 in favor of Buy over Hold, the stock boasts a Strong Buy consensus rating. (See FUBO stock forecast on TipRanks)
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Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.
