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Friday, September 29, 2023

Why FUBO's Momentum May Be Far From Finished

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FuboTV (FUBO) is an intriguing pick in today’s market. Indeed, it appears investors and the broader market tend to agree.

Fubo is a stock that’s absolutely on fire right now. Since hitting a low in mid-May of less than $15 per share, FUBO stock has more than doubled to more than $30 per share in recent weeks. This momentum appears to have stalled somewhat in recent days, with FUBO stock trading near its one-month lows. (See fuboTV stock charts on TipRanks)

That said, there are certainly reasons to believe this momentum can continue. Investors bullish on streaming and content providers have piled into such plays in earnest recently. Indeed, there are certain growth areas of the market that continue to generate significant interest from retail and institutional investors alike.

Let’s dive into whether or not this momentum can resume with FUBO stock, and what may lie ahead for investors interested in this company.

Business Model Intriguing to Growth Investors

FuboTV has found a unique niche in the streaming segment. The company’s focus on becoming a major player in the virtual multichannel video programming distribution (vMPVD) space is a bold one. To date, the company has made some strong strides in this direction.

FuboTV currently offers more than 100 channels through its standard plan. This standard package is impressive, when one considers the offerings of other streaming platforms that have been making headway in the sports content space.

As an aggregator of streaming content, Fubo relies on securing a broad array of content contracts across a variety of sports, at prices that make economic sense to investors. As an emerging player in this space, the upside FUBO stock provides is attractive. Indeed, as more sports enthusiasts cut the cord on their cable packages, live sports is one area that may be missed. Fubo is looking to fill that gap.

FUBO Stock Attractive for Meme Stock Investors and Gaming Enthusiasts Alike

Many investors might already be aware that FUBO stock has become a hot commodity among many retail investors and traders of late. Indeed, this is one of the stocks that has gotten caught up in the meme stock mania of recent months. One might suggest that the company’s meteoric rise to more than $62 per share in late-2020 wasn’t the result of natural market forces.

This certainly makes sense when one considers the company’s current short interest of around 21%, as well as the company’s relatively small market cap and its growth prospects. This is a company which is compelling from a variety of angles, and retail investors have jumped aboard.

One of the angles retail investors are paying close attention to right now is Fubo’s move into gaming. The company announced its intention to launch a sports betting app in Q4 of this year, following the acquisition of Vigtory, a sports betting-focused start-up.

Given the synergies with this potential deal, the move to vertically integrate into the sports betting space seems logical. We’ve all seen the kinds of momentum key players such as DraftKings (DKNG) and Penn National Gaming (PENN) have experienced recently. All indications are that this is a growth market with plenty of room for multiple players. Fubo is simply looking for a seat at the table.

What Analysts Are Saying About FUBO Stock

According to TipRanks’ analyst rating consensus, FUBO stock comes in as a Strong Buy. Out of 7 analyst ratings, there are 6 Buy recommendations and 1 Hold recommendation.

As for price targets, the average fuboTV price target is $38.86. Analyst price targets range from a low of $25.00 per share to a high of $60.00 per share.

Bottom Line

Streaming is here to stay, and investors are jumping aboard. On this basis alone, FUBO stock looks attractive in its own right.

Additionally, the company’s recent moves into sports betting, as well as this company’s inclusion into the Russell 3000, change the game for bears on this stock. There are a number of catalysts driving momentum for FUBO stock right now. Accordingly, this remains a stock with significant buying pressure that’s difficult to short or to take an opposing stake in right now.

Thus, there’s a pervasive feeling FUBO stock could run in the near-term. Over the longer term, investors may trim back their expectations on the basis of valuation multiples and earnings. However, as far as story stocks go, fuboTV remains red-hot, and may remain so for some time.

Disclosure: Chris MacDonald held no position in any of the stocks mentioned in this article at the time of publication.

Disclaimer: The information contained herein is for informational purposes only. Nothing in this article should be taken as a solicitation to purchase or sell securities.

The post Why FUBO's Momentum May Be Far From Finished appeared first on TipRanks Financial Blog.

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