FuboTV soared after sports-streaming underdog gave media giants a bloody nose
FuboTV (NYSE:FUBO) stock surged close to 20% in Monday’s deals after a court ruling temporarily blocked the launch of Venu Sports – a new sports streaming joint venture owned by Disney (NYSE:DIS), Fox Corp (NASDAQ:FOX) and Warner Bros Discovery (NASDAQ:WBD).
NYSE-quoted FuboTV, which has a market value of around $600 million, was an early-mover in sports streaming in North America – which has since 2015 carried tier-one sports including NFL, NBA, NHL, MLB, and the English Premier League, selling subscriptions through content licensing partnerships with various cable broadcasters.
FuboTV earlier this year filed an antitrust lawsuit against Venu Sports, the proposed new sports streaming ‘giant’, claiming that the joint venture would monopolise the sports streaming market, reducing competition and driving up prices for consumers.
With an early, but not yet decisive, score FuboTV’s claim was supported by Judge Margaret Garnett of the Southern District of New York, who temporarily ruled to halt the launch pending further legal proceedings or a final decision by the court.
Investors in FuboTV (and day traders) cheered this early ruling, sending the stock higher.
Early for celebrations
But, expert market commentators aired caution noting that it may be too early to celebrate as Disney, Fox and Warner Bros Discovery can still win in the courts, by the time a final decision is reached.
Michael Pachter, analyst at West Coast stockbroker Wedbush, meanwhile, said the ruling has given FuboTV some breathing room, whilst pointing out that it is not necessarily a binary contest.
“Ultimately, we expect the injunction to be lifted, provided that the defendants satisfy the court that they will behave in a manner so as to encourage competition.
“We would consider this a favorable resolution, and do not expect the Venu offering to materially impact Fubo so long as Venu is competitively priced and Fubo has continued access to the same content offered by Venu.”
Wedbush has an ‘outperform’ rating for FuboTV with a 12-month price target of $5.00.
Today, meanwhile, FuboTV stock was up 17.65% to close the regular trading session at $1.80.
