Fubo TV (FUBO) stock was on fire Monday, jumping nearly 24%, with volume over three times the 30-day average. The move gets it close to where it traded before it did a 1-for-12 reverse split on March 24.
Despite the gains, the stock’s standard deviation of 3.02 was only the 17th highest of yesterday’s Top 100 Bullish Price Surprises. FUBO’s had 40 moves of 5% or more in the past 12 months, but nothing as big as yesterday’s.
If you’re an aggressive investor, I think it can’t hurt to consider why this time might be different. That said, the sports and TV streaming service has, at best, a checkered past; at worst, its very survival hangs by a thread.
While yesterday’s news from FuboTV management sounded optimistic, the past has proven that talk is cheap. FUBO is most definitely not something you spend your retirement on. Not by a long shot.
However, if you have a small “Fun Fund” set aside with some cash, here are three things to consider before deciding whether now is the time to buy.
Free Cash Flow Positive
In CEO David Gandler’s Q1 2026 shareholder letter, he stated that the company expects to generate positive free cash flow in fiscal 2027 (September year-end) and fiscal 2028.
“Expect Fubo will be Free Cash Flow positive starting Fiscal 2027, and we do not anticipate needing additional outside financing through Fiscal 2028 based on our current operating plan,” stated Gandler’s shareholder letter.
By fiscal 2028, it also expects to generate at least $300 million in adjusted EBITDA (earnings before interest, taxes, depreciation and amortization). As a result, it said that its cash and cash equivalents will exceed all of its debt by then.
When was the last time FuboTV could make this claim? As of Q1 2026. Its cash, cash equivalents, and restricted cash totalled $458.6 million, $135.7 million above its $322.9 million in debt.
As Gandler led off the latest shareholder letter, “FuboTV Inc. is in the strongest financial position in our history based on our current outlook.”
The closest it came before this was in 2021, when it had $379.4 million in cash, cash equivalents, and restricted cash, compared to $408.9 million in debt, a difference of $29.5 million
In fiscal 2025, the year-end switched to Sept. 30, due to the combination of FuboTV and Walt Disney Co.’s (DIS) Hulu+ Live TV business. I’ll get to this in the next section.
The difficulty with betting on FuboTV turning free cash flow positive is that it has never done so. Investors face the risk that Gandler and the management team will not deliver on their optimistic outlook.
Yesterday’s 24% jump suggests investors are willing to play along — for now.
The Merger Rationale
FuboTV merged with Disney’s Hulu+ Live TV business on Oct. 29, 2025, with the former managing the merged entity, but the latter owning 72.9% of the business.
You know what they say, it’s better to have a smaller piece of a bigger pie than a bigger piece of a smaller pie. The combination created the sixth-largest Pay TV provider in the U.S., with aƒsplitlmost 6 million subscribers, and was within shouting distance of YouTube TV at 10 million. In addition, Disney will provide a $145 million term loan to the business to help it through the integration period.
Ultimately, once Gandler and the board figure out the best way to grow the subscriber base, there’s a good chance the two separate streaming services will become one. That should help with profitability.
Further, FuboTV gained a stronger board and the backing of a $170 billion entertainment company. Survival necessitated the deal.
Consider that FuboTV had an accumulated deficit of $2.02 billion as of Dec. 31, 2024. That got wiped clean after the merger. At the same time, the business’s assets grew by a factor of four to $4.10 billion.
In the trailing 12 months ended Dec. 31, 2025, its pro forma revenue was $6.2 billion, and its adjusted EBITDA was $77.9 million. By 2028, it expects that to be $300 million or higher. If revenues stay the same, that’s a 4.8% margin, up considerably from 1.3% today.
Disney’s enterprise value is 2.3 times revenue. If FuboTV could get halfway there by 2028, it would have an enterprise value of $7.13 billion, 1.6 times its current valuation.
Investing is about probabilities. Will this happen for FuboTV? I’d say it’s got a 25% chance. That’s better than nothing.
The Bottom Line on FUBO Stock
As I write this early in Tuesday trading, FUBO stock is up another 4-5% on healthy volume.
I’d look at what the options market is saying about the stock. Yesterday’s action was slightly higher than the 30-day average, but nowhere near the 98,748 contracts traded on March 23, the day before the reverse split. If yesterday’s 24% gain wasn’t an aberration, today’s volume should be much higher than 11,516. I guess we’ll see.
As I said in the previous section, FuboTV racked up some pretty impressive losses over the past five years. It’s going to take an actual “transformative business combination” for the company to erase some of the deficit in the next three years.
Ultimately, it has to grow its North American subscriber base to more than 6.2 million. Finding cost efficiencies should help with cash flow, but without growth, it becomes harder to pay for the content needed to keep nipping at YouTube TV’s heels.
Will this come to fruition? That’s the million-dollar question.
On the date of publication, Will Ashworth did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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