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Is FUBO Stock a Solid Long Term Investment?

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It appears as 2021 draws to a close, the stock known as FUBO has been seeing a reputation improvement ever since its wild see-saw rides the virtual content provider from New York experienced earlier in the year. At one point, it seemed to invest in fuboTV was too risky to consider. As of October 2021, things seemed to calm down somewhat, only for more chaos to erupt when its recent earnings were publicly reported. One of the primary reasons why fuboTV found itself feeling like an amusement park ride was the influence brought about by Reddit traders. The drama has since smoothed itself out and it's back to business as usual, at least according to the world of the New York Stock Exchange (NYSE). But, the question remains about FUBO. Are FUBO stocks a solid long-term investment or not? For shareholders who aren't shy of a roller-coaster ride, investing in and sticking with FUBO isn't so bad. There have been a number of deals the company has made that stand to increase fuboTV's value where there is potential for the long-term investment into their stocks worthwhile. Not only has the company won over the attention of the most insightful shareholders and stock traders, but expert analysts have also seen the potential growth in fuboTV to be more than some short-term phenomenon.

Who is FUBO?

FUBO, otherwise known as fuboTV, is a subscription video-on-demand service, much like Amazon Prime, Disney's Hulu Live Channel, and Netflix. When measuring fuboTV up with the giants of the content streaming playground, they're still relatively small beans. According to The Motley Fool, the market cap for fuboTV is just shy of four billion dollars with a trailing twelve-month revenue of $330 million. The purpose behind fuboTV is to provide the most competitive lineup of sports programming, which is a formula that has been working very well for the company so far. With subscriptions, the revenue grew by seventy-three percent in 2020 that experienced a financial gain of $230 million. While this is indeed impressive, there were concerns about how well fuboTV can maintain a solid footing as a content streaming company that can stand the test of time and competition. However, with the announcement in April 2021 that fuboTV has exclusive streaming rights for the Qatar World Cup 2022 qualifying matches of the South American Football Confederation, this seems to be fuboTV's official bet that they have what it takes to fend off networking rivals such as Disney's ESPN+ and ViacomCBS' Paramount+. The winning formula fuboTV continues to display, despite what the instability of the 2021 stocks suggests and the threats of its rival giants seeking an opportunity to squash fuboTV before it gets too big.

However, fuboTV offers more than one hundred channels that have as much sports programming material as a fan could hope for. It is for reasons such as this why more people are pulling away from their cable subscriptions in favor of either virtual multichannel video programming distributors (vMVPD) or streaming video-on-demand (SVOD) subscriptions. FuboTV's subscription base is on the vMVPD format, which has some investors concerned as it's not as fast-growing as SVOD. Since 2020, over one billion households subscribed to SVOD services at a rate of a sixty-five percent leap. With vMVPD, it only grew just over two percent that same year. While these numbers don't seem so favorable for fuboTV at the moment, it is believed in the long run people will grow tired of managing between different SVOD subscriptions and favor a solid vMPVD service that offers more variety. This is where fuboTV stands to become the long-haul winner, but this will depend entirely on how they manage the entire platform since there are similarities between it and regular cable TV. Some Wall Street analysts fear consumers are shying away from vMVPD subscriptions because it seems too familiar with the headaches that came with cable TV subscriptions. Among the investors who've already invested into the long-term focus of FUBO and its fuboTV success, some have already raked in a healthy return, unlike the short-term investors who treated the market in 2021 as if it was a hop-scotch competition. During the first quarter of 2021, the digital advertising revenue fuboTV grew by 206% since the previous year's first quarter. As impressive as that may sound for some, this is still considered a small piece of what fuboTV's total revenue had become.

What's Up with FUBU?

Among the people who pay attention to the stock markets, FUBO made some news when they popped and dropped in December 2020. It happened again from January until March 2021. The main reason for this trampoline action was the investors that jumped in and out as a means to make a quick profit. For investors looking to make some kind of gain, jumping in at the right moment was vital. Make a wrong judgment call and the investment resulted in a loss of money quickly. Come October and early November 2021, the wild dance of FUBU's stocks finally showed signs of settling at a more controlled pace. However, when a less than impressive earnings report was submitted just after this brief little time frame, the wild dance for FUBU began yet again as short-term investors looking for the fast buck started playing around with their investments again. Meanwhile, long-term investors are holding their ground with FUBO as they see the end-goal potential fubuTV seems to have in store. There is a strong bet FUBU's stock may once again see a fifty-two-week high of $62.00 USD without the help of meme stock traders. It will depend entirely on the company's ability to deliver the goods to generate enough value to make the investment become worthwhile. FuboTV's intent is to offer additional services to its current subscription platform to make it stand out that much more from other vMVPD services on the market. It also recently acquired Vigtory, which sets the groundwork for an aggressive push into online sports betting. This market is estimated to grow in worth to $155 billion by 2024, at least according to Zion Marketing Research.

While fuboTV is not the only vMVPD subscription service available to the public, it is the fastest-growing one among them. Even the little crash in early December 2021 is not enough to take out FUBO. In fact, the little scare seems to be putting them on the right track to rise from the ashes and become stronger and more stable than ever. This is how stocks have been known to work sometimes. FuboTV is championship material, but like most champions, needs to take a serious fall first before making an epic comeback. That crash was the result of inexperienced and short-term investors who don't have the knowledge, patience, or stomach to see something promising grow to the potential it is more than capable of doing. While vMVPD seems like a regular cable television connection, the bottom line is they're not. Regular cable television means you set everything aside to watch whatever is aired at the timing it's aired. Streaming cable television service such as fuboTV has it arranged you watch what you want when you want, and however, you want. You don't need to plop in front of a screen at home to watch. You can use your Smartphone, tablet, laptop, or whatever you have at your disposal at whatever location you happen to be.

With the prices of fuboTV bottoming out like they had since the early December 2021 crash, if there is ever a time for long-term investors to get in, now would be it. There are over seventy million traditional pay-TV households in the United States alone that have yet to make the jump. This leaves plenty of room for fuboTV to welcome those new subscribers when they decide to subscribe. It's not a matter of if they will subscribe to a vMVPD platform, it's a matter of when. With more and more programs signing exclusive deals with content streaming networks like fuboTV, there will be less content for the regular television networks to work with. This will cause more viewers to make the switch, many of whom are already one foot out the door as it is as they want better than what their money is so far paying for.

Profitable Partnerships

FuboTV has joined the ranks of content streaming services that seek to replace cable television as we know it. More businesses are beginning to make partnership deals with fuboTV as they seem to share the same interest to break away from the dependence on cable TV. Furthermore, fuboTV's strong presence in the sports streaming market and wagering has won over the attention of the New York Jets who recently made an announcement of a multi-year deal with Fubo Sportsbook to become the club's official sports betting partner. This has enabled the Fubo Sportsbook Lounge that has been established at MetLife Stadium as it hosts the team's home games, making it the first mobile sports betting lounge that's authorized to operate in the complex. There's also a long-term team up with the Cleveland Cavaliers, which has Fubo Gaming as the presenting partner of Cavs Pick 'Em free-to-play live predictive gaming platform. With Nascar, Fubo Sportsbook will be promoted as the authorized gaming operator through a multi-channel marketing campaign. Judging by the growth rate of fuboTV's progress and its partnerships, it is projected by Berenberg's Zachary Silberberg that the streaming network will have over two million subscribers by 2025. Already, it has surpassed the one million subscriber mark. Just in September's quarter alone, fuboTV added 262,884 new subscribers, which is nearly double the amount Wall Street expected. Among fuboTV subscribers, approximately ninety percent are sports fans. According to Berenberg, the pace rate fuboTV is going may see a far beyond average market performance.

For the Long Haul

There is the possibility that FUBO will have its stock prices reach $62.00 USD or higher, but this is not expected to happen overnight. Sustainable growth is what cautious investors prefer to see, especially with fuboTV. This, ideally, is what should happen as the partnerships fuboTV has so far established will remain in good standing for some time to come. Also, with more push to cut the cord from cable TV, content streaming networks like fuboTV have so much to gain, which seems inevitable.

One of the biggest risks analysts and experienced investors are looking into is the possibility of VMVPDs having too much in common with bundled cable plans that have been turning the consumers off. However, fuboTV's focus is to keep in touch with what consumers are most interested in as far as programming entertainment is concerned, which is also looking into the possibility they may grow bored with the SVOD system where there's usually two or more subscriptions involved due to whatever lineup each platform has available. That can be complex itself, not to mention costly. In the long run, subscribers may drop the SVOD services, especially if they have more than one of them, in favor of one simple plan that works best for them.

As a long-term investment, fuboTV seems to make sense, at least for serious investors wishing to tap into it now. However, like all investments, there are risks. Buying, trading, and selling stocks is just like gambling where you're placing a bet on something that seems like a sure-fire winner. The most cautious investors, especially when they encounter a stock entity such as FUBO, they usually start with a small investment first. Then, if it seems promising enough, invest a bit more gradually. For fuboTV, it will show promising when there's a steady flow of subscribers at a stable pace. At the moment, fuboTV seems to be pouring much focus on catering to sports fans, which is a huge plus. At the moment, the stock value of fuboTV is at all-time lows, but it's suspected it won't stay this way for long.

Allen Lee

Written by Allen Lee

Allen Lee is a Toronto-based freelance writer who studied business in school but has since turned to other pursuits. He spends more time than is perhaps wise with his eyes fixed on a screen either reading history books, keeping up with international news, or playing the latest releases on the Steam platform, which serve as the subject matter for much of his writing output. Currently, Lee is practicing the smidgen of Chinese that he picked up while visiting the Chinese mainland in hopes of someday being able to read certain historical texts in their original language.

Read more posts by Allen Lee

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