FuboTV (FUBO) and Walt Disney's (DIS) agreement to combine FuboTV and Hulu + Live TV creates a dominant player in the over-the-top broadcast market with over 6.2 million subscribers, Wedbush said in a note Tuesday.
Settlement of antitrust claims related to the planned Venu joint venture among Disney, Fox (FOX) and Warner Bros Discovery (WBD) strengthens FuboTV's balance sheet, according to the note.
The firm said the combined entity is slightly smaller than competitors like SlingTV and YouTubeTV but remains well positioned to capture "cord nevers," a demographic that avoids traditional cable.
"We firmly believe that the new FuboTV can add 500,000 to 1 million customers per year for the next four years, which is likely to drive revenue growth of $500 million or more each year," Wedbush said.
The brokerage raised its price target on FuboTV's stock to $6.40 from $3 and reiterated its outperform rating.
Price: 5.99, Change: +0.93, Percent Change: +18.38
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