The New York-based streaming television service was coming off an excellent earnings report, but I was more impressed with the company’s plan to grow its sportsbook offerings.
“The company needs to continue expanding its sportsbook footprint across the U.S.,” I wrote on Aug. 13. “If it does so, then the sky’s the limit for this growth stock.”
So, it comes as no surprise that FUBO stock saw a nice pop recently when the company made an announcement just to that end.
Overall, FUBO stock is now up almost 17% since the beginning of June. And as Wall Street barrels closer to the fourth quarter, I think it’s just getting started.
FuboTV’s Latest Announcement
The reason why fuboTV jumped by nearly 6% on Aug. 31 was its newest sportsbook revelation. FuboTV said the state of Iowa approved a license for Fubo Gaming to offer advance deposit online wagering in the state. Fubo Gaming, of course, is a subsidiary of fuboTV.
The license was granted in partnership with Casino Queen, which operates a riverboat casino in Marquette, Iowa. Fubo Gaming President Scott Butera explained:
“As we enter the mobile sports betting market, we couldn’t be more excited to kick off this journey in Iowa. We thank the IRGC and Casino Queen for being the perfect partner in helping us cross the goal line and bring this sportsbook to the passionate sports fans of Iowa We believe Fubo Sportsbook will provide an elevated sports entertainment experience that will bring increased interaction and engagement between sports viewing and betting.”
Collectively, Iowa marks the fifth state where fuboTV has market access agreements for its fledging sportsbook, joining Arizona, Pennsylvania, Indiana and New Jersey.
Moreover, what makes FUBO stock particularly interesting is the company’s plans for its sportsbook.
As a streaming entertainment provider, fuboTV has an emphasis on live sports. That includes streaming international soccer, tennis, golf and major American sports leagues. In fact, it streams more than 50,000 live sporting events every year.
Also, its audience is growing rapidly. According to the company’s second-quarter earnings report, fuboTV added 91,291 net new users, ending the quarter with 681,721 subscribers. Those users watched 245 million hours of content, which represents a 148% growth from the previous year.
Additionally, the company made $130.9 million in revenue, which was an increase of 196% from the previous year.
FuboTV says it expects to reach 810,000 to 820,000 subscribers by the end of the third quarter, and add another 100,000 to that by the end of 2021.
Sure, there are other streaming services out there that are bigger than fuboTV. But what they can’t offer is the ability to operate a sportsbook on the sporting events it streams.
That said, FuboTV can.
In fact, it plans to fully integrate its betting platform with its live-streaming service. That will give users what the company calls “a seamless viewing and wagering experience.”
Just imagine: FuboTV viewers will be able to use the yet-to-be launched Fubo Sportsbook to review odds and place bets on the same screen where they’re watching the game.
As of today, the sports wagering platform would only be available in the five states where fuboTV has licenses. But as the company expands its wagering footprint, the company should see an instant impact on its revenue.
The Bottom Line for FUBO Stock
Right now, FUBO stock trades for $28.38 per share, which is about half of the peak of its 52-week range. But when the sportsbook goes on line later this year, current prices may be seen as a bargain.
FUBO stock has a “B” rating in my Portfolio Grader right now with a buy recommendation.
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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