FUBO - fuboTV: Value Trap Shareholder Dilution Coming (Rating Downgrade)

2024-04-16 11:54:09 ET

Summary

• fuboTV Inc.'s balance sheet shows a worsening net debt position, with $155 million in Q4 2023.
• With projections indicating a potential burn through of $140 million in free cash flow for 2024, the company faces a looming cash crunch.
• The possibility of shareholder dilution, estimated at 25%, further compounds the challenges posed by fuboTV's financial woes.

Investment Thesis

fuboTV Inc. ( FUBO ) was once a high-flying stock with a massive shareholder following. Today, it's a shadow of its former self. And even though the stock is down significantly from its all-time highs, I argue that not only is this stock not undervalued, but it's actually likely to sell off further, as fuboTV is likely to dilute investors by early 2025, as it seeks to raise precious capital to keep its balance sheet afloat....

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