fuboTV (FUBO) posted some highly impressive results in its latest quarterly statement, but they weren’t enough to fend off the bears who sent shares tumbling by 23% in the subsequent session. The sports-focused streaming company reported a bigger loss than anticipated as adjusted EBITDA came in at $(81) million vs. the consensus estimate of $(58) million.
Otherwise, however, it was an “impressive beat-and-raise,” says Wedbush analyst Michael Pachter.
Revenue increased by 156% year-over-year to $156.69 million, in the process beating the Street’s call by $13.35 million. Advertising revenue reached $18.6 million, a 147% increase on the same period last year. Subscription revenue rose by 158% to $138.1 million, while the subscriber count increased by 108% YoY and 39% sequentially to 944,605. The company also said that as of October it had passed the 1 million subscriber threshold.
FUBO raised its guidance again, for the 4th quarter in a row, and for the full year the company now expects revenue between $612 – 617 million, up from $560 – 570 million. There was also a raise for the paid subscribers outlook, which are now anticipated to reach 1.06 – 1.07 million compared to the prior 910,000– 920,000 estimate. The Street was targeting 927,000 subscribers.
FUBO also announced international expansion as it plans on acquiring France-based Molotov SAS, a leading “freemium” live TV streaming service. The purchase will cost roughly $190 million. It’s a good move, says Pachter.
“fuboTV should immediately benefit from this acquisition as it adds another 100 experienced staff to its own 400, adds four million subscribers to its one million from which it can drive up-sells to sports and possibly wagering, and it adds a global footprint to accelerate its expansion,” the analyst explained.
Investors latched on to the continued losses and Pachter agrees the acquisition will probably “extend the road to profitability.” However, the analyst believes it will pay off in the long run as it “greatly increases the scale of future profitability.”
All in all, Pachter stays with the bulls, maintaining an Outperform (i.e. Buy) rating along with a $53 price target. Investors are looking at upside of 117% from current levels. (To watch Pachter’s track record, click here)
Most of the Street concurs; based on 6 Buys vs. 1 Hold, the analysts’ view is that FUBO is a Strong Buy. There’s plenty of upside projected too; the $47.5 average target, suggests shares will appreciate by 86% in the year ahead. (See fuboTV stock analysis 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.
