Is FUBO stock a buy right now?

Live sports streaming platform fuboTV (NYSE: FUBO) has been increasingly favoured among investors lately with WSB investors sending shares sharply higher.

Fundamental analysis: How it operates?

The company currently has a few revenue streams, the most important of them being selling streaming subscriptions. FuboTV offers a variety of packages which users can choose to stream live TV including more than 100 channels, most of which are sport-related. 

The company reported it had 455,000 paid subscribers as of Q3, marking a 58% year-on-year rise. One of the biggest drivers of its revenue is advertising. FuboTV collaborates with the most popular ad-tech firms including The Trade Desk and Magnite, significantly boosting its growth. FuboTV’s ad revenue rose by 153% year-on-year in Q3. 

At first glance, ad revenue might seem like an unimportant growth factor for FuboTV as only 12% of total revenue came from ad revenue. The company said that roughly $7.50 of its monthly average revenue per unit (ARPU) came from advertising, amounting to around $22.50 per quarter

Furthermore, a small part of FuboTV’s revenue also comes from sublicensing certain international sports events to other companies, allowing them to broadcast sports events it has the rights to. However, this is a less significant revenue stream for FuboTV as only $586,000 came from this source during the first nine months of 2020. 

During that 9-month period, FuboTV said it had sustained a net loss of $402.5 million, indicating that the company had faced serious revenue challenges. 

Technical analysis: Where next?

FUBO stock price is trading over 17% higher so far in February thanks to a move of nearly 25% on Monday. In January, shares of fuboTV gained over 50% with the stock up over 400% since October. 

fuboTV daily chart (TradingView)

Last week, the FUBO stock price went to print $57.47 and then rotated lower to the $40 mark where support sits. This pullback was used as a buying opportunity with the price action moving additional 40% from this support. From here, we may see another pullback to $45 which is likely to be seen as a chance to get on the long side targeting 20% to 25% on the upside.

Summary

Sports events streaming platform FuboTV has been one of the hottest stocks lately. The company has three primary income sources including selling streaming subscriptions, advertising, and sublicensing broadcast rights.

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