fuboTV FUBO shares have skyrocketed 127.8% in the year-to-date period, outperforming the Zacks Consumer Discretionary sector and the S&P 500 index’s decline of 11.3% and 10.7%, respectively, and the Zacks Broadcast Radio and Television industry’s growth of 1.4%.

The company’s strong performance has been driven by its merger agreement with Disney DIS to combine Hulu + Live TV with fuboTV, positioning the company as the sixth-largest pay TV provider by subscriber count. It now ranks just behind major industry players, such as Comcast CMCSA and Charter Communications CHTR. 

Comcast offers streaming alternatives like Xfinity Stream and NOW TV, positioning itself against FuboTV by bundling live sports, news, and entertainment. Charter Communications offers its Spectrum TV and Spectrum TV Essentials streaming services and provides affordable live TV packages that include major broadcast and sports channels. In addition to the merger, fuboTV will also receive a cash infusion from Disney and other Hulu partners to the tune of $220 million. Shares of Disney, Comcast and Charter Communications have lost 25.7%, 10.6% and 3%, respectively, in the year-to-date period. 

Given the recent share price rally, investors might be wondering whether to buy, hold or sell the stock. Let’s take a closer look at the factors helping and hurting fuboTV to come to a conclusion.

Factors Benefiting fuboTV Stock

fuboTV’s ongoing focus on product innovation and subscriber monetization has supported its performance. In the fourth quarter of 2024, the company reported a record ARPU of $87.90 in North America and achieved positive free cash flow for the first time, reflecting improved operational efficiency. The launch of new content bundles, including the Zee Family package catering to South Asian audiences, and low-cost skinny bundles aligned with its super-aggregation strategy, are helping the company tap into new audience segments. Additionally, improved subscriber retention, aided by its free-tier strategy, has showed positive results.

Headwinds Facing fuboTV Stock

Despite operational gains, FuboTV continues to face pressure on several fronts. Ad revenues declined 11.8% year over year in the fourth quarter of 2024, impacted by content portfolio adjustments, including the non-renewal of Univision and Discovery networks. Subscriber guidance for the first quarter of 2025 reflects a 4% year-over-year decline in North America, with international markets expected to contract by 16%. Broader market challenges, such as slowing industry-wide migration from traditional TV, rising content costs, and macroeconomic pressures, also present headwinds.

FUBO’s Earnings Estimate Revisions Show Steady Trend

The Zacks Consensus Estimate for FUBO’s first-quarter 2025 loss is currently pegged at 4 cents per share, which has remained unchanged over the past 30 days. The estimate indicates year-over-year growth of 63.64%. 

The consensus mark for revenues is pegged at $414.53 million, indicating a year-over-year increase of 3.03%.

FUBO beat the Zacks Consensus Estimate for earnings in each of the trailing four quarters, with the average surprise being 49.72%.

See the Zacks Earnings Calendar to stay ahead of market-making news.

Here’s Why You Should Hold FUBO Stock for Now

Despite strong subscriber growth, positive free cash flow, and product expansion, fuboTV faces near-term challenges that warrant a cautious stance from investors. While the merger with Hulu + Live TV and a $220 million cash infusion from partners like Disney provide scale and financial support, headwinds like declining ad revenues, international subscriber softness, and rising content costs persist. Additionally, the loss of key channels like Univision and Discovery may limit content appeal in the short term.

FUBO currently carries a Zacks Rank #3 (Hold), suggesting that it may be wise for investors to wait for a more favorable entry point in the stock. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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Comcast Corporation (CMCSA) : Free Stock Analysis Report

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Charter Communications, Inc. (CHTR) : Free Stock Analysis Report

fuboTV Inc. (FUBO) : Free Stock Analysis Report

This article originally published on Zacks Investment Research (zacks.com).

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