When John identifies a strategic exit point, he will send you an alert with specific trade information as to what security to sell, when to sell it, and at what price. Most often, it will be to TAKE PROFITS, but, on rare occasions, it will be to exercise a STOP LOSS at a predetermined price to adhere to strict risk management discipline. Read more
I was going to hold off on writing about this streaming service, but the shares are up another 15% this morning on a down day and that has forced my hand.
Streaming platforms have done extremely well during the pandemic and it is a no-brainer to put two and two together because consumers stuck at home would obviously mean more streaming consumption.
But what about those streaming services that you have not heard about?
They do exist and now I am here to tell you about one of them.
Enter fuboTV (FUBO).
FuboTV is an American streaming television service that focuses primarily on channels that distribute live sports, including NFL, MLB, NBA, NHL, MLS, and international soccer, plus sports news, network television series, and movies.
Yes, I must admit that fuboTV isn’t the newest company. The company was established in 2015 and some of the hardcore streamers will see this service pop up on their Roku (ROKU) amongst other platforms.
After a more focused migration into live sports television, a key deal to bring Disney’s ESPN to its platform, and a pair of acquisitions to allow sportsbook operations beginning in 2021.
FUBO has potential and is already showing robust growth backed by the kind of subscriber numbers needed to turn an eventual profit.
November’s third-quarter print showed accelerating subscriber growth from 58% to 72% and sales surging from 71% to 80%.
I am quite positive on FUBO’s ability to monetize traffic at much higher rates than its competitors.
That includes streaming hardware darling Roku, which captures less than one-third of FUBOs per user ad revenue.
FUBO had just 545,000 subscribers entering into 2021, but its free-spending audience that totals an average of four hours a day streaming the platform is a bedroom piece of foundation to this upstart company.
It is generating an average $7.50 in monthly ad revenue per user, and that’s on top of the $65 monthly fee for the entry-level plan featuring 118 different channels.
The big selling point for fuboTV is that more than three dozen of those networks are dedicated sports channels.
FUBO’s capture of ESPN last summer was a coup, but it also dropped Turner’s sports-heavy properties.
It’s true that it is not the perfect service, and is missing some crucial content.
They are also not carrying Sinclair’s regional sports channels.
Cord cutters are helping this stock be hard to bet against after joining the services in droves in 2020.
FUBO actually was laser-focused on European soccer at the beginning but understood they needed to branch out to capture other pro sports fans and widen its audience.
Unlike Netflix, advertising is a key component in the company’s revenue. It works with top ad-tech companies like The Trade Desk (TTD) and Magnite, and these partnerships are helping it with growth.
In the third quarter, ad revenue grew 153% year over year.
FUBO’s ad business is already far ahead of Roku’s, perhaps demonstrating the greater monetization potential of live sports and TV compared to on-demand streaming.
FUBO believes it can generate more than $20 in ARPU after paying the third-party vendors it works with.
A net loss of $402.5 million through the first nine months of 2020 is standard for most teething growth companies and the unprofitability shouldn’t stop investors from this stock.
If you do choose to dip your toe into this stock, then be aware the volatility might make you feel unsteady at night.
The wild swings are a sign of an immature company growing into its investor base.
“We are the first species capable of self-annihilation.” – Said CEO of Tesla Elon Musk
When John identifies a strategic exit point, he will send you an alert with specific trade information as to what security to sell, when to sell it, and at what price. Most often, it will be to TAKE PROFITS, but, on rare occasions, it will be to exercise a STOP LOSS at a predetermined price to adhere to strict risk management discipline. Read more
Global Market Comments
January 29, 2021
Fiat Lux
Featured Trade:
(THE MAD HEDGE FUND TRADER’S FAVORITE ONLINE BROKER)
“It’s a funny thing about life. If you refuse to accept anything but the best, you very often get it,” said British Novelist, Somerset Maugham.
Mad Hedge Biotech & Healthcare Letter
January 28, 2021
Fiat Lux
FEATURED TRADE:
(WATCH OUT FOR THESE BUYOUT STOCKS)
(TBIO), (MRNA), (PFE), (BNTX), (SNY), (BLUE), (BMY)
Many predictions this 2021 probably won’t pan out. However, here’s a pretty safe bet: we will see a number of biotechnology company acquisitions this year.
Although it’s not easy to accurately forecast which biotechnology companies will be involved in these deals, there is a handful that qualifies as prime acquisition targets.
One of the top biotech buyout candidates in my radar this year is Translate Bio (TBIO).
Thanks to the massive success of the COVID-19 programs of Moderna (MRNA), Pfizer (PFE), and BioNTech (BNTX), a spotlight has been cast on the benefits of the messenger RNA (mRNA) technology.
That’s why I wouldn’t be surprised if bigger players in the healthcare industry decide to scoop up smaller players to stake a claim in this quickly growing space.
Among all the small-cap biotechs in play, Translate Bio is easily one of the top prospects.
Before Moderna and BioNTech hogged the spotlight with their mRNA-based COVID-19 vaccines, Translate Bio was actually one of the strong contenders in the race. Unfortunately, it failed to keep up with its peers and is now lagging well behind the leaders.
On the flip side, the attention that mRNA technology has been getting these days seemed to have strengthened the confidence of investors in the technology – an effect that Translate Bio greatly benefited from in the past months.
Despite its lagging performance in the COVID-19 race, Translate Bio has been making significant progress with its work with partner Sanofi (SNY) on their own candidate, MRT5500. If all goes well, then the product should be out by the first quarter of 2021.
Apart from that, the two have been focusing on different vaccine candidates for other viral and bacterial diseases.
Translate Bio’s pipeline also includes treatments targeting another lucrative market using the same MRT platform technology as MRT5500: cystic fibrosis (CF).
The company’s CF treatment has been causing excitement among investors because instead of offering invasive therapy, this option offers patients an inhaled version of the mRNA drug as treatment.
Moreover, the MRT platform technology of Translate Bio could be expanded to cover more than just CF – a promising diversification that encouraged big investors like Sanofi to continuously pour money into collaborations with this Massachusetts-based biotech.
As mRNA technology gains more traction, Sanofi might even reevaluate its relationship with Translate Bio and decide that it wants more than just a collaboration.
With the smaller biotech company’s modest market capitalization of only a little over $1.7 billion, an acquisition could be on the table sooner rather than later.
Another potential buyout candidate is Bluebird bio (BLUE).
Unlike its contemporaries in the biotech space, Bluebird shares plunged by nearly 50% in 2020.
Although the company offers a promising upside potential, it can’t seem to generate sufficient enthusiasm to take part in the biotech sector’s rally last year.
In fact, Blue stock continued to hover near its 52-week low despite several gene and cell therapy tickers reaching all-time highs.
While that’s obviously bad news for Bluebird shareholders, I think this makes the company an even more attractive acquisition candidate.
I think it’s important to determine the reasons behind Bluebird’s abysmal 2020 performance.
The stock had a rocky start last year, with the COVID-19 pandemic exacerbating its overall meltdown.
One of Blue’s major roadblock was its failure to secure approval from the FDA for its multiple myeloma treatment, which it has been working on with Bristol Myers Squibb (BMY).
Then, it delayed its submission for approval of its sickle cell disease treatment LentiGlobin. This was initially set for the second half of 2021 but was pushed to late 2022.
The main takeaway from this streak of negative updates is that Blue still doesn’t have its act together when it comes to dealing with regulatory approval processes.
Regardless, the potential of this biotech’s pipeline remains impressive.
Apart from its work with Bristol and LentiGlobin, Bluebird has been working on a late-stage candidate for treatment of a rare metabolic disorder called cerebral adrenoleukodystrophy with Lenti-D.
Prior to its partnership with Bristol, Bluebird was actually partnered with Celgene.
When Celgene was bought by Bristol in 2019, the bigger company continued the collaboration with Blue and expanded the partnership to cover more genetic disorders and extend to oncology treatments.
Due to the setbacks, Bluebird’s market capitalization now hovers somewhere near $3 billion.
Given all these pipeline candidates and its future plans, I suspect it wouldn’t take long before a major player takes notice of this attractive valuation and puts this bird in a cage.
Overall, both Translate Bio and Bluebird are solid companies in the biotechnology space.
While the COVID-19 pandemic slowed down some of their progress, the products in their pipelines could yield substantial value to interested acquisition partners.
Global Market Comments
January 28, 2021
Fiat Lux
Featured Trade:
(THE LAZY MAN’S GUIDE TO TRADING),
(ROM), (UXI), (BIB), (UYG),
(TESTIMONIAL)
Two years ago, I put my wife’s entire 401k into your “Lazy Man’s” portfolio. Then I forgot about it.
Yesterday, I opened it up to take a look at it and I almost fell out of my chair. It was up 50%! In only two years!
Thank you for under-promising and over-delivering. My wife thanks you even more for setting up a more comfortable retirement for the both of us.
Next time you’re in town, we would love to take you out to Billy Bob’s for dinner and we’ll buy you the biggest steak you have ever seen. They have a stock ring INSIDE the restaurant.
Thanks a “million”!
George
Fort Worth, Texas
