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What to Look for When fuboTV Reports Q2 Earnings

FuboTV (NYSE:FUBO) stock will certainly post another loss when its files its second-quarter earnings report on Aug. 10.

A picture of a FuboTV (FUBO) logo on a smart phone against a computer keyboard.
Source: Lori Butcher/ShutterStock.com

And for a stock that is already down 12% in the last month, and by nearly 6% on a year-to-date basis, that’s not great news.

But there’s more than what’s on the surface of fuboTV these days. In fact, a new agreement shows that FUBO stock may start to turn the corner as early as the fourth quarter of this year.

That’s something to get excited about. Especially if you believe in sportsbooks.

What is fuboTV?

FuboTV is a New York-based streaming television service. It offers programming of all types and it’s capitalizing on the continuing trend of Americans who are cutting their cable cords in favor of streaming entertainment.

What makes fuboTV a little different, however, is that the company has a greater-than-normal emphasis on carrying live sports. It has international soccer, tennis, golf, and of course, major American sports leagues.

In all, the company says that it streams more than 50,000 live sporting events in a year. That includes exclusive streaming rights to the South American Qatar World Cup 2022 Qualifiers, which will feature popular teams such as Argentina, Brazil and Uruguay.

Earnings in the first quarter showed revenue at $119.7 million, which was a 135% increase from the previous year. Subscriber growth came in at a 105% increase to 590,000. And average revenue per user gained 28% from the previous year, to $69.09.

Those numbers should improve in the second quarter. According to the Zacks consensus estimate, the company is expected to show revenues of $121.28 million in the quarter, which would be an increase of nearly 175% from the same quarter a year ago.

Even with that improvement, FUBO stock is expected to lose 47 cents per share in the second quarter. But investors will be willing to sacrifice earnings today as long as the company continues to show its impressive growth.

Growth of a Sportsbook

FuboTV is adding to its growing sportsbook footprint.

The company announced last month that it reached an agreement with The Cordish Companies for its upcoming sportsbook in Pennsylvania. The deal, which would provide statewide mobile access for sports betting and internet gaming, still needs to be approved by state regulators.

But when that happens, fuboTV will have market access licenses to run sportsbooks in four states, with Pennsylvania joining Indiana, Iowa and New Jersey.

Roth Capital analyst Darren Aftahi says the company is expected to roll out its sportsbooks in the fourth quarter of this year. And most notable for investors, Aftahi says potential revenues from the sportsbook launches are not yet calculated into the company’s 2021 revenue estimates.

Aftahi bumped up his price target for FUBO stock to $42 and issued a “buy” recommendation.

Integration Makes FUBO Stock Interesting

Sports wagering is a huge business that is about to skyrocket. Forbes reports that sports betting in the U.S. generated $1 billion in revenue last year. But by 2023, that number will grow six-fold.

Casinos and sports betting platforms will be hot investments. But fuboTV has its own take on sports wagering.

Rather that operating a separate sports wagering platform, fuboTV plans to fully integrate its betting platform with its live streaming platform for a “seamless viewing and wagering experience.”

That’s a novel concept. And while some experts are not convinced such integration is fully feasible, fuboTV has been sticking to its plan.

It’s yet to be seen if the unique integration plan will be more or less costly for the company to operate. Any news about that during the company’s second-quarter earnings call with analysts could potentially move FUBO stock after hours.

The Bottom Line

True, fuboTV is losing money to grow its platform and sportsbook. But investors should be patient as long as the company can continue its current growth trajectory in terms of subscriber and revenue per average user.

The company’s sportsbook will come online in the fourth quarter, and is another reason to like FUBO stock here. And with prices currently depressed from the start of the year, FUBO stock is an interesting opportunity for growth investors.

On the date of publication, neither Louis Navellier nor the InvestorPlace Research Staff member primarily responsible for this article held (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

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Article printed from InvestorPlace Media, https://investorplace.com/2021/08/what-to-look-for-when-fubo-stock-reports-earnings/.

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