After a dramatic surge in Netflix’s stock price in 1H 2020, shares have been effectively stuck at the ~$500 level over the past six months. The recent underperformance has largely been driven by fears of a COVID-19 pull-forward creating challenging comps for 2021 and rising concerns about intensifying streaming competition. While there is little doubt…
We are lowering our one-year target price on Fubo to $6.50 from $8 and maintaining our SELL rating, based on a 7.5x multiple of 2025 advertising contribution margin discounted back at 15% for four years. The change from our prior target is based on the assumption that Fubo will need to raise at least $1…
Happy New Year and good riddance to 2020. As always, we are kicking off TMT coverage in the new year by laying out our top predictions and events to watch for in 2021 – what we call our #Top21for21. To see what we got right and wrong in last year’s Top 20 list for 2020, it can be…
In early May, we downgraded Disney to SELL (link). Our call has been dead wrong. At the time we focused on how the market under-appreciated the impact of COVID-19 on fiscal (September) 2020-2021 earnings. We knew numbers needed to come down significantly and expected the stock to follow, especially as leverage far exceeded historical norms.…
As it turns out, vMVPD’s really did not offer much of a fresh start for the multichannel video industry. As these services emerged, the hope was to offer consumers better price / value bundles by starting the channel offerings from scratch. For the most part, that hope is gone and vMVPDs are looking more like…
Happy New Year! We had a lot to say about tower stocks in 2020, but stopped short of making formal recommendations as valuations rose quickly following the approval of T-Mobile’s acquisition of Sprint which, in turn, triggered overly optimistic domestic growth expectations. The end of year sell-off in tower stocks and digestion of higher than…
Radius Global is a new type of wireless infrastructure investment opportunity. It owns the property under wireless towers and generates tower-like revenue escalators. Radius pays no taxes because it’s still in the early stages of consolidating a global portfolio of assets, but we believe REIT status is inevitable. Management is top notch. The $13 stock…
Over the past 20 years, the multichannel video business has gone from a great high margin business to an awful one. The industry incumbents are still there mostly for bundling benefits, and virtual MVPDs without other strategic objectives have pulled back. Since the first vMVPD launched in 2015 (Sling), many have entered the space, but…
We are initiating coverage of FUBO with a Sell rating and $8 one-year price target, based on a 7.5x multiple of 2025 advertising contribution margin discounted back at 15% for four years. Fubo (NYSE-$52.59) may be the most compelling short we have ever identified in our career as analysts. Over the past few months, we…
Last week’s Disney Investor Day was a stunning display of content that illustrated the company now understands the need to dramatically increase spending on original programming for Disney+ to increase engagement (ramping from $2 billion annually today to over $8 billion annually by 2024). Increasing engagement with must-see content will not only reduce churn and…
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