The market is a volatile beast. Fubo stock (NYSE:FUBO) skyrocketed two years ago after the live-TV streaming service announced plans to cash in on sports betting in late 2020 and early 2021. The stock rose this week when the service declared it was withdrawing its chips from the table in that regard.
Of course, starting lines are important. During the 2020 holiday season, fuboTV stock reached an all-time high of $62.29 as investors were enthused about the potential of a sports-centric streaming service that integrated fantasy sports and betting elements into its platform. Today, a fuboTV share can purchase a Happy Meal. Let’s make some Xs and Os examine how the market received the fuboTV announcement.
Market Analysis of Fubo Stock
On Tuesday, fuboTV stock (NYSE:FUBO) began 14% higher and rose as high as 17% before giving up virtually all of those gains. The stock would end the day with less than a 2% gain.
The market’s early euphoria seemed misplaced. After declaring that it was evaluating strategic options for its sports betting business, it was one of the market’s biggest winners in early August, momentarily more than doubling by mid-month. FuboTV has launched competitions in which fans of live sports events may make predictions about near-term results in return for service awards. This was designed to be a stepping stone to the more profitable sportsbook it hoped to launch. Still, as a small participant in a game where jumping through regulatory hoops required time and financial fortitude, it recognized it might need to outsource the operations.
Investors were expecting in August for a significant player in the gambling industry to step up, operate the firm, and pay fuboTV a percentage of the activity. This week’s news is different. There were a few firms interested in taking over fuboTV’s gaming sector. However, none of them provided the young service with the capacity to reduce its financing needs while still generating enough returns for its stockholders. It is closing its Fubo Sportsbook section, which it owns and operates.
It wasn’t all terrible news, either. FuboTV disclosed preliminary North American revenue for the third quarter of at least $210 million, a 34% increase and slightly over the $200 million to $205 million it forecasted earlier in the summer. The $5.5 million it expects to disclose outside of North America when it announces its third-quarter results on Nov. 4 is exactly in the middle of its range.
What Next for Fubo Stock
A lot may happen in the next three years, and fuboTV is still a small player in the world of massive streaming service stocks. The concept has shifted, and some of the more interesting sports-related benefits that distinguished the service has vanished. Growth has also dropped after a 70% year-over-year growth the last time around and steady triple-digit increases before that.
This does not imply that fuboTV is out of the game. It’s just replacing a quarterback with a rocket arm but poor accuracy with a game manager in the pocket who can nail the short passes to keep the sticks moving. It’s not thrilling, but it’s a quicker method to score.
Featured Image – Megapixl © Rafaelhenriquepress
Author Okoro Chinedu 
