Read Why Needham Reiterated Buy On fuboTV Despite Slashing Its Price Target By 67%

Needham analyst Laura Martin saw fuboTV Inc FUBO as an inexpensive way for public investors to participate in the U.S. consumer shift toward OTT and Streaming TV. 

Martin called FUBO a skinny bundle (also known as a virtual MVPD) that markets itself as a "sports-first" linear TV replacement. 

FUBO offers over 100+ live linear TV channels representing about 80% (Martin's estimate) of an average large bundle's TV viewing hours, at $65/month if consumers commit to a 1-year plan. 

Users can disconnect 97% of their FUBO subscription monthly without penalty.

While FUBO focused on growing its installed base of subscribers, Martin is most excited about high-margin add-on new revenue streams such as up-sells, advertising, wagering, and channel fees. 

From a valuation perspective, FUBO is an inexpensive streaming service as per Martin because it trades at about 1/3 of Roku, Inc's ROKU multiple and a 35% discount to Netflix, Inc's NFLX multiple. 

The upside is from wagering multiples, which are much higher than streaming, suggesting that FUBO is even more undervalued than that industry.

Martin maintained her 2Q22 estimates for revenue and Adj EBITDA Loss. She slightly shifted the 2Q revenue mix between subscription and advertising.

Martin cut her FY22 estimates for FUBO to reflect growing competition in the vMVPD space, slower streaming ad-rev growth, and weakening U.S. consumer spending owing to higher gasoline prices and other inflationary pressures on goods.

Martin shifted some of her sub-growth from FY22 into FY23, leading to higher revenue for FY23. She also projected higher costs in FY23 due to wagering.

Martin cut the price target on FUBO to $5 from $15 and maintained a Buy.

Price Action: FUBO shares traded lower by 3.75% at $2.57 on the last check Wednesday.

Image by mohamed Hassan from Pixabay

Posted In: Analyst ColorNewsPenny StocksPrice TargetReiterationSmall CapAnalyst RatingsTech

Ad Disclosure: The rate information is obtained by Bankrate from the listed institutions. Bankrate cannot guaranty the accuracy or availability of any rates shown above. Institutions may have different rates on their own websites than those posted on The listings that appear on this page are from companies from which this website receives compensation, which may impact how, where, and in what order products appear. This table does not include all companies or all available products.

All rates are subject to change without notice and may vary depending on location. These quotes are from banks, thrifts, and credit unions, some of whom have paid for a link to their own Web site where you can find additional information. Those with a paid link are our Advertisers. Those without a paid link are listings we obtain to improve the consumer shopping experience and are not Advertisers. To receive the rate from an Advertiser, please identify yourself as a Bankrate customer. Bank and thrift deposits are insured by the Federal Deposit Insurance Corp. Credit union deposits are insured by the National Credit Union Administration.

Consumer Satisfaction: Bankrate attempts to verify the accuracy and availability of its Advertisers' terms through its quality assurance process and requires Advertisers to agree to our Terms and Conditions and to adhere to our Quality Control Program. If you believe that you have received an inaccurate quote or are otherwise not satisfied with the services provided to you by the institution you choose, please click here.

Rate collection and criteria: Click here for more information on rate collection and criteria.