FUBO Stock Forecast: Excess Dilution and Bad Earnings will kill the FUBO stock

Today we are looking at fuboTV Inc. (NYSE: FUBO), to determine if you should buy FUBO stock. We will look at FUBO financial ratios, analyst ratings, and current valuation to determine a FUBO forecast and price. What Does FUBO Do? fuboTV Inc. operates a live TV streaming platform for live sports, news, and entertainment content in the United States and internationally. Its fuboTV platform allows customers to access content through streaming devices, as well as on SmartTVs, computers, mobile phones, and tablets. The company is headquartered in New York, New York. FUBO Stock Forecast and Analysis fuboTV Inc. Competition and Comparables In order to undergo a comparable analysis (to determine FUBO stocks value), we need to first outline who FUBO's competitors are. These competitors need to be publicly listed, have valid financial metrics/multiples, operate in a similar manner to FUBO, and have a market cap similar to FUBO (if possible). By keeping this in mind, I found the following list of companies to be some of FUBO stocks closest competitors: MAX, CNK, MSGE, UZA, GTN, GTN-A, TDJ, TDA, TDE, TDS FUBO Stock News and Information Analysis of fuboTV Inc. Stock Performance and Financial Ratios FUBO Earnings (Yearly): FUBO Revenues: In FY 2021, FUBO experienced a yearly increase in revenues of $420.6M (or 193.16%) resulting in a total revenue figure of $638.35M. FUBO Cost of Revenues: In FY 2021, FUBO experienced a yearly increase in their cost of revenues of $415.02M (177.53%), resulting in a total revenue figure of $648.8M. Since the increase (of 177.53%), in FUBO's cost of revenue was lesser (by -15.64%) than the increase (of 193.16%) in FUBO's revenues, we should expect that FUBO experienced an increase (roughly 15.64%) in their FY gross profits. FUBO Gross Profit: In FY 2021, FUBO experienced a yearly increase in their gross profit of $5,582,000 (or 34.81%) resulting in a total gross profit of $-10.45M. This decrease is consistent with our conclusion from the comparison of revenues and cost of revenues between FY and FY. FUBO EBITDA: In FY 2021, FUBO experienced a yearly incresae in their EBITDA of $199,249,000 (or 38.56%) resulting in a total EBITDA of $-317.45M. This decrease (of 38.56%) stems from the fact that FUBO experienced a decrease in their gross profits of -4.81% (as we saw in the previous bullet point). FUBO Net Income: In FY 2021, FUBO experienced a yearly increase in their net income of $187,496,000 (or 32.87%) resulting in a total net income of $382.84M. FUBO EPS: As a result of FUBO's decrease in net income of $187.5M, FUBO's EPS also increased (by $10.132) from $-12.82 in FY 2020 to $-2.69 in FY 2021 Overall, FUBO earnnings in 2021 were great as it demonstartes that they are on the right path, and they might soon become profitable. However, has this optimistic trend continued in more recent FUBO earnings? Let's find out by looking at the Q1 2022 Fubo Earnings report. FUBO Earnings (Quarterly): FUBO Revenues: In Q1 2022, FUBO experienced a quarterly increase in revenues of $10.96M (or 4.74%) resulting in a total revenue figure of $242.02M. FUBO Cost of Revenues: In Q1 2022, FUBO experienced a quarterly increase in their cost of revenues of $31.6M (13.48%), resulting in a total revenue figure of $265.96M. Since the increase (of 13.48%), in FUBO's cost of revenue was greater (by 8.74%) than the increase (of 4.74%) in FUBO's revenues, we should expect that FUBO experienced an decrease in their Q1 gross profits. FUBO Gross Profit: In Q1 2022, FUBO experienced a quarterly decrease in their gross profit of $20,634,000 (or -624.33%) resulting in a total gross profit of $-23.94M. This decrease is consistent with our conclusion from the comparison of revenues and cost of revenues between Q1 and Q4. FUBO EBITDA: In Q1 2022, FUBO experienced a quarterly decrease in their EBITDA of -$81,983,000 (or -30.94%) resulting in a total EBITDA of $-123.53M. This decrease (of -30.94%) stems from the fact that FUBO experienced a decrease in their gross profits of -624.33% (as we saw in the previous bullet point). FUBO Net Income: In Q1 2022, FUBO experienced a quarterly decrease in their net income of $28,763,000 (or -25.69%) resulting in a total net income of $-140.72M. FUBO EPS: As a result of FUBO's decrease in net income of $28.75M, FUBO's EPS also decreased (by $0.13) from $-0.76 in Q4 2021 to $-0.89 in Q1 2022 Overall, it seems as though FUBO had a poor financial performance (due to EPS decreasing by $0.13) as many of their financial metrics shrunk, most notably their EPS (by $0.13), as well as their net income (by $28.75M), and other metrics (as you can tell from the above bullet points). This is not a good sign as it may indicate that they have deviated from tehir path to profitability. Is FUBO Share Dilution an Issue? As part of their Q1 2022 earnings release, FUBO stated that they currently have 157.5M Shares Outstanding (weighted average), which is up 9.45M shares (from 148.05M shares outstanding in Q4 2021). This represents a share dilution of around 6.4% which should scare potential FUBO investors. Keep an eye out for FUBO share dilution as it may become a bigger problem in the future. Latest FUBO Stock Analyst Ratings Here is the current analyst rating distribution for FUBO. In total there are 16 FUBO stock analyst ratings. 10 Buys 5 Holds 1 Sells Analyst Ratings have provided relatively strong indicators of future price movement, which is why they are used to determine if FUBO stock is a buy or sell FUBO Stock Forecast and Valuation FUBO Price Forecast Using Comparable Analysis Price to Book (P/B): FUBO's current P/B ratio is 0.74, compared to the average P/B ratio of FUBO's peers being 27.26. This implies that FUBO is undervalued and their share price should change by a factor of 3,560% to be at fair value (based on FUBO's P/B compared to the P/B of their peers). Price to Equity (P/E): FUBO stock P/E ratio is currently -1.15, compared to the average P/E ratio of FUBO's peers being 16.52. This implies that FUBO is overvalued and their share price should change by a factor of -1,541% to be at fair value (based on FUBO's P/E compared to the P/E of their peers). Overall, this comparable analysis can be voided as a result of FUBO having very unusual financial ratios.  Is FUBO Stock a Buy or Sell? Overall, I am forced to make a decision based off of FUBO's financials, which seemed great yearly. However, this was very deceitful as FUBO had a horrendous 2020 which made their 2021 results look great. However, over their past 4 quarterly reports, FUBO has experienced 3 consectuive earnings misses, with their net income decreasing by 18% QoQ, and their EPS dropping by $0.40 over the 3 quarter period. As a result, I would consider a short-term bear position (if any) in FUBO. 

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FUBO Stock Forecast: Excess Dilution and Bad Earnings will kill the FUBO stock

Jun 7, 2022

bearish

general Analysis

[5 min Read]

blog post cover photo

Photo by: Nicolas J Leclercq

Today we are looking at fuboTV Inc. (NYSE: FUBO), to determine if you should buy FUBO stock. We will look at FUBO financial ratios, analyst ratings, and current valuation to determine a FUBO forecast and price.

What Does FUBO Do?

fuboTV Inc. operates a live TV streaming platform for live sports, news, and entertainment content in the United States and internationally. Its fuboTV platform allows customers to access content through streaming devices, as well as on SmartTVs, computers, mobile phones, and tablets. The company is headquartered in New York, New York.

FUBO Stock Forecast and Analysis

fuboTV Inc. Competition and Comparables

In order to undergo a comparable analysis (to determine FUBO stocks value), we need to first outline who FUBO's competitors are.

These competitors need to be publicly listed, have valid financial metrics/multiples, operate in a similar manner to FUBO, and have a market cap similar to FUBO (if possible).

By keeping this in mind, I found the following list of companies to be some of FUBO stocks closest competitors:

MAX, CNK, MSGE, UZA, GTN, GTN-A, TDJ, TDA, TDE, TDS

FUBO Stock News and Information

Analysis of fuboTV Inc. Stock Performance and Financial Ratios

FUBO Earnings (Yearly):

  • FUBO Revenues: In FY 2021, FUBO experienced a yearly increase in revenues of $420.6M (or 193.16%) resulting in a total revenue figure of $638.35M.
  • FUBO Cost of Revenues: In FY 2021, FUBO experienced a yearly increase in their cost of revenues of $415.02M (177.53%), resulting in a total revenue figure of $648.8M. Since the increase (of 177.53%), in FUBO's cost of revenue was lesser (by -15.64%) than the increase (of 193.16%) in FUBO's revenues, we should expect that FUBO experienced an increase (roughly 15.64%) in their FY gross profits.
  • FUBO Gross Profit: In FY 2021, FUBO experienced a yearly increase in their gross profit of $5,582,000 (or 34.81%) resulting in a total gross profit of $-10.45M. This decrease is consistent with our conclusion from the comparison of revenues and cost of revenues between FY and FY.
  • FUBO EBITDA: In FY 2021, FUBO experienced a yearly incresae in their EBITDA of $199,249,000 (or 38.56%) resulting in a total EBITDA of $-317.45M. This decrease (of 38.56%) stems from the fact that FUBO experienced a decrease in their gross profits of -4.81% (as we saw in the previous bullet point).
  • FUBO Net Income: In FY 2021, FUBO experienced a yearly increase in their net income of $187,496,000 (or 32.87%) resulting in a total net income of $382.84M.
  • FUBO EPS: As a result of FUBO's decrease in net income of $187.5M, FUBO's EPS also increased (by $10.132) from $-12.82 in FY 2020 to $-2.69 in FY 2021

Overall, FUBO earnnings in 2021 were great as it demonstartes that they are on the right path, and they might soon become profitable. However, has this optimistic trend continued in more recent FUBO earnings? Let's find out by looking at the Q1 2022 Fubo Earnings report.

FUBO Earnings (Quarterly):

  • FUBO Revenues: In Q1 2022, FUBO experienced a quarterly increase in revenues of $10.96M (or 4.74%) resulting in a total revenue figure of $242.02M.
  • FUBO Cost of Revenues: In Q1 2022, FUBO experienced a quarterly increase in their cost of revenues of $31.6M (13.48%), resulting in a total revenue figure of $265.96M. Since the increase (of 13.48%), in FUBO's cost of revenue was greater (by 8.74%) than the increase (of 4.74%) in FUBO's revenues, we should expect that FUBO experienced an decrease in their Q1 gross profits.
  • FUBO Gross Profit: In Q1 2022, FUBO experienced a quarterly decrease in their gross profit of $20,634,000 (or -624.33%) resulting in a total gross profit of $-23.94M. This decrease is consistent with our conclusion from the comparison of revenues and cost of revenues between Q1 and Q4.
  • FUBO EBITDA: In Q1 2022, FUBO experienced a quarterly decrease in their EBITDA of -$81,983,000 (or -30.94%) resulting in a total EBITDA of $-123.53M. This decrease (of -30.94%) stems from the fact that FUBO experienced a decrease in their gross profits of -624.33% (as we saw in the previous bullet point).
  • FUBO Net Income: In Q1 2022, FUBO experienced a quarterly decrease in their net income of $28,763,000 (or -25.69%) resulting in a total net income of $-140.72M.
  • FUBO EPS: As a result of FUBO's decrease in net income of $28.75M, FUBO's EPS also decreased (by $0.13) from $-0.76 in Q4 2021 to $-0.89 in Q1 2022

Overall, it seems as though FUBO had a poor financial performance (due to EPS decreasing by $0.13) as many of their financial metrics shrunk, most notably their EPS (by $0.13), as well as their net income (by $28.75M), and other metrics (as you can tell from the above bullet points). This is not a good sign as it may indicate that they have deviated from tehir path to profitability.

Is FUBO Share Dilution an Issue?

As part of their Q1 2022 earnings release, FUBO stated that they currently have 157.5M Shares Outstanding (weighted average), which is up 9.45M shares (from 148.05M shares outstanding in Q4 2021). This represents a share dilution of around 6.4% which should scare potential FUBO investors. Keep an eye out for FUBO share dilution as it may become a bigger problem in the future.

Latest FUBO Stock Analyst Ratings

Here is the current analyst rating distribution for FUBO. In total there are 16 FUBO stock analyst ratings.

  • 10 Buys
  • 5 Holds
  • 1 Sells

Analyst Ratings have provided relatively strong indicators of future price movement, which is why they are used to determine if FUBO stock is a buy or sell

FUBO Stock Forecast and Valuation

FUBO Price Forecast Using Comparable Analysis

  1. Price to Book (P/B): FUBO's current P/B ratio is 0.74, compared to the average P/B ratio of FUBO's peers being 27.26. This implies that FUBO is undervalued and their share price should change by a factor of 3,560% to be at fair value (based on FUBO's P/B compared to the P/B of their peers).
  2. Price to Equity (P/E): FUBO stock P/E ratio is currently -1.15, compared to the average P/E ratio of FUBO's peers being 16.52. This implies that FUBO is overvalued and their share price should change by a factor of -1,541% to be at fair value (based on FUBO's P/E compared to the P/E of their peers).

Overall, this comparable analysis can be voided as a result of FUBO having very unusual financial ratios.

Is FUBO Stock a Buy or Sell?

Overall, I am forced to make a decision based off of FUBO's financials, which seemed great yearly. However, this was very deceitful as FUBO had a horrendous 2020 which made their 2021 results look great. However, over their past 4 quarterly reports, FUBO has experienced 3 consectuive earnings misses, with their net income decreasing by 18% QoQ, and their EPS dropping by $0.40 over the 3 quarter period.

As a result, I would consider a short-term bear position (if any) in FUBO.

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FUBO

fuboTV Inc.

2.46

-0.01
-0.40%

Return

-
Position Return %
0.00
Position Return
3.27
Price When Posted

Metrics

2.94
Target Price
5/ 10
Confidence
1-2 Weeks
Timeframe
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SEC
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