Shares of fuboTV, jumped 12.2% in Tuesday’s extended market trading after the a sports-first live TV streaming platform announced a deal to buy Balto Sports, which develops tools for fantasy sports games. The company did not disclose the terms of the deal but said that the Balto Sports acquisition will mark its debut into online sports wagering market.
FuboTV (FUBO) announced that “Balto’s team will join fuboTV and will be instrumental in driving the company’s expansion into both free to play gaming and online sports wagering.” Further, “fuboTV intends to leverage its own proprietary technology along with Balto’s contest automation software to launch a free to play gaming offering.”
FuboTV’s CEO David Gandler said “We believe there are significant synergies between consumers who enjoy wagering and our subscribers who enjoy streaming live sports, creating a flywheel opportunity.” He added that “one of our goals with wagering is to expand our total available market (TAM) by developing another important revenue stream for fuboTV, as we are doing with our growing ad sales business.” (See FUBO stock analysis on TipRanks)
On Nov. 23, Needham analyst Laura Martin raised the stock’s price target to $30 (12.2% upside potential) from $20 and maintained a Buy rating as she sees upside potential in connected TVs. In a note to investors, Martin said “While FUBO is focused on growing its installed base of subscribers, we are most excited about high-margin add-on new revenue streams such as up-sells, advertising, sports-betting and channel fees.”
Like Martin, the Street also has a bullish outlook on the stock with a Strong Buy analyst consensus. The average price target stands at $24.33 and implies downside potential of about 9% to current levels. Shares have rallied over 200% year-to-date.