Why fuboTV Stock Was Up Big Today

What happened

fuboTV (FUBO 13.25%) saw its stock price surge higher on Friday, up 12% as of 2:25 p.m. ET. The stock is trading at around $2.60 per share, up about 51% year to date.

The markets were mixed on Friday as the S&P 500 was down 4 points (-0.1%), the Dow Jones Industrial Average gained 46 points (0.6%), and the Nasdaq Composite fell 47 points (-0.3%) as of 2:25 p.m. ET.

So what

fuboTV, a TV streaming platform, got a lift today, along with competitors like Netflix, perhaps in reaction to some turmoil involving a cable provider and the owner of some networks.

Specifically, the dispute was between Disney and its networks, ESPN and ABC, and cable provider Charter Communications. Charterʻs Spectrum cable blocked the two Disney networks from its platform Thursday night after the two companies did not meet the deadline to secure a distribution agreement. The two sides are apparently in a dispute over fees. Spectrum is the nationʻs second-largest cable provider.

This had the effect of hurting TV and cable stocks on Friday, like Warners Brothers Discovery, down 12%, Paramount Global, down 9%, and Comcast, down 2%, while boosting streamers like fuboTV, which are competitors to cable TV companies.

Now what

fuboTV has had a nice run this year, and it is still pretty cheap with a price-to-sales ratio of 0.45 and a share price of about $2.60 per share. 

It saw a big spike in revenue in the most recent quarter, up 41% year over year, while the number of subscribers jumped 23% compared to the second quarter of 2022 to $1.2 million.

It also raised its full-year 2023 guidance for North America, now projecting 1.565 million to 1.585 million subscribers, a 9% year-over-year increase. Revenue guidance was also heightened to $1.26 billion to $1.28 billion, a projected 29% year-over-year jump.

The company, however, is operating at a net loss of $54 million. That is down from $95 million in Q2 of 2022.

The growth and valuation are positives, but keep in mind that this is a highly competitive and dynamic market. Look for consistent growth in subscribers and forward movement toward profitability each quarter.

Dave Kovaleski has positions in Walt Disney. The Motley Fool has positions in and recommends Netflix, Walt Disney, Warner Bros. Discovery, and fuboTV. The Motley Fool recommends Comcast. The Motley Fool has a disclosure policy.

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