We recently compiled a list of the 10 Best Broadcasting Stocks to Buy. In this article, we are going to take a look at where FuboTV Inc. (NYSE:FUBO) stands against the other broadcasting stocks.
Technological advancements have transformed the global broadcasting market, just as much as any other industry. Innovation has elevated the broadcasting experience for an average viewer, offering a wide range of rich and high-quality content. Hence, in 2022, we had a global broadcasting market valued at $343.35 billion, as reported by Grand View Research. By 2030, this number could reach $448.34 billion, growing at a compound annual growth rate of 3.9% through the forecast.
As machine learning and AI help gain companies a competitive edge, AI-powered solutions are being used in broadcasting to enhance video quality, streamline live broadcasts, and personalize user experiences.
For instance, Korbyt, a workplace experience platform, recently launched its Machine Learning Broadcast solution, which uses an AI-powered camera to adjust content based on viewer engagement. In essence, it uses smart technology to show different content on screens based on who’s watching and how they react. So, if people are spending a lot of time looking at a certain ad, Korbyt might show that ad more often. It can even optimize recommendations according to people’s preferences and create new content for them.
The global advertising and broadcast industries are also close and benefit from one another. One impact currently is the surge in political advertising spending on broadcasting platforms due to the US election campaign. As the demand for advertising space across various platforms rises, advertising rates for broadcasting companies with increase and boost their revenues.
Forbes reported that the total spending reached $8.5 billion across TV, radio, and digital media in the last election cycle. This was 30% higher than the $6.7 billion projected earlier that year, and 108% more than spending in 2017-2018, which was a record at that time. GroupM projects a record-breaking $15.9 billion investment in political ad spending for the end of 2024.
As campaigns intensify their advertising efforts, especially in the weeks preceding the election, broadcast companies can anticipate a significant rise in revenue, given the heightened demand for airtime to reach voters.
According to Emarketer, 45% of the total digital political ad spending will be seen on CTV (connected TV). As major companies in the networking, entertainment, and streaming industry continue their ban on political content, the major benefit of this spending will go to broadcasting companies.
Goldman Sachs’ Jonny Fine, the global head of investment grade debt, in a recent discussion, mentioned that the US election will likely be a big market event. He says that the outcome could most definitely differ depending on which candidate emerges victorious, but investors need to be prepared for the potential market volatility nonetheless. However, when it comes to realizing short-term gains from elections, the 2019-2020 US election cycle advertising spending validates the projections for this year.
The Business Research Company reports that North America dominated the broadcast market in 2023, but Asia-Pacific is expected to grow the fastest in the coming years. With a promising growth potential, this industry can reward those who watch it closely and observe its dynamics. In this context, we are here with a list of the 10 best broadcasting stocks to buy.
Methodology
To compile our list, we sifted through ETFs, stock screeners and online rankings to compile a list of 15 best broadcasting stocks to buy. We then selected the 10 stocks that were the most popular among elite hedge funds and that analysts were bullish on. The stocks are ranked in ascending order of the number of hedge funds that have stakes in them, as of Q2 2024. The hedge fund data was sourced from Insider Monkey’s database which tracks the moves of over 900 elite money managers.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
Huge crowds in a sports stadium with their smartphones streaming a live game.
FuboTV Inc. (NYSE:FUBO)
Market Cap: $610.93 million
Number of Hedge Fund Holders: 13
FuboTV Inc. (NYSE:FUBO) is a streaming television service focusing primarily on live sports channels, providing a convenient and accessible way for viewers to watch their favorite games and other live television content.
The streaming service has won a significant victory against a proposed joint venture by Disney, Fox, and Warner Bros. Discovery. This would have controlled a significant portion of live broadcast sports content, potentially harming the company’s business. The CEO, David Gandler, argued that this venture would have deprived consumers of choice and hindered the company’s success. Following the judge’s ruling, the joint venture is unlikely to proceed.
FuboTV Inc. (NYSE:FUBO) expects North American subscribers in 2024 to grow 7% year-over-year at the midpoint. The projected number of subscribers is between 1.725 million and 1.745 million. The company reported strong financial results for Q2 in North America. Total revenue increased by 25.01% to $390.97 million, and paid subscribers grew by 24% to 1.45 million. The advertising business revenue rose 14% to $25.8 million. The loss per share was $0.04.
It launched Fubo Free, a free ad-supported streaming service with nearly 200 channels. This service is currently available to certain former Fubo paid and free trial subscribers. Users can reactivate their paid subscriptions at any time. The company plans to expand Fubo Free to other cohorts in the future.
It repurchased $46.9 million of convertible debt and issued stock to fund these repurchases. This strategic move reduced debt, enhanced shareholder value, and increased financial flexibility. The company remains focused on providing consumers with a premium sports entertainment offering at an affordable price. Such commitments and strides make this company a top broadcasting stock to buy.
Currently, 13 hedge fund holders have invested in the company. Highbridge Capital Management is the largest one with a position of $11,975,000, as of June 30.
Overall FUBO ranks 6th on our list of the best broadcasting stocks to buy. While we acknowledge the potential of FUBO as an investment, our conviction lies in the belief that AI stocks hold great promise for delivering high returns and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than FUBO but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
