Small-cap stocks typically outperform large- and mid-cap stocks during economic recovery. The current economic recovery is making for a favorable backdrop for small-cap companies because it is now affording them better expansion opportunities and easy access to capital.
Because improving employment levels and the government’s fiscal and monetary policy support are expected to keep driving the economy’s recovery, Wall Street analysts are bullish about the growth prospects of fuboTV Inc. (FUBO) and Gain Therapeutics, Inc. (GANX). Based on consensus price targets, these two stocks are expected to double over the next 12 months.
fuboTV Inc. (FUBO)
FUBO is the leading sports-first live TV streaming platform that operates in the U.S., Canada and Spain. Through its cable TV replacement product, fuboTV, subscribers can stream a broad mix of 100+ live TV channels. Soon, Fubo Gaming Inc., a subsidiary of fuboTV Inc., expects to launch Fubo Sportsbook, a comprehensive sports entertainment experience, through sports betting and interactive gaming.
This month, FUBO delivered record-breaking revenue and a better-than-expected growth in total subscribers for the first quarter, ended March 2021, despite past seasonal trends. Its live streaming platform also increased ad revenue tremendously.
The company’s total revenue increased 135% year-over-year to $119.72 million for the first quarter, ended March 31. Its advertising revenue grew 206% from its year-ago value to $12.6 million. FUBO’s adjusted contribution margin rose 230 basis points year-over-year to 5.3%. Also, the company’s subscription revenue increased 131% from the prior-year quarter to $107.1 million.
FUBO is expected to see 143.5% revenue growth year-over-year to $530.21 million in the current year, whereas its EPS is expected to grow 73% from the year-ago value in the current year.
Of the seven analysts that rated the stock, six have rated it Buy. A $38.86 consensus price target represents an 88.3% increase from its last closing price of $20.64.
Gain Therapeutics, Inc. (GANX)
GANX develops various therapeutics to treat diseases caused by protein misfolding. Its primary focus is on rare genetic diseases and neurological disorders. The company uses its Site-Directed Enzyme Enhancement Therapy (SEE-Tx) to redefine drug discovery. It is working towards developing a cure for various diseases, including Morquio B, GM1 gangliosidosis (GM1), neuronopathic Gaucher disease, GBA1 Parkinson’s, Krabbe, and Mucopolysaccharidosis type 1 disease.
Last month, GANX entered a multi-target collaboration agreement with Zentalis Pharmaceuticals, an oncology company, to discover new product candidates for the treatment of cancer. According to the agreement, GANX will be involved in the identification of target proteins along with determining their potential suitability, while Zentalis will carry out the testing of selected compounds. This collaboration should diversify GANX’s portfolio and solidify its position in the market.
GANX’s cash and cash equivalents were $46.59 million in the first quarter, ended March 31, compared to $7.49 million at the close of 2020. Its net cash from financing activities increased 2920.9% to $41.99 million over the period. Analysts expect the stock’s EPS to rise 12.4% in the current year.
Two Wall Street analysts have provided ratings for the stock and both have rated it Buy. Closing yesterday’s trading session at $9.61, the consensus price target of $30 represents a potential upside of 212.2%.
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FUBO shares were trading at $20.57 per share on Wednesday afternoon, down $0.85 (-3.97%). Year-to-date, FUBO has declined -26.54%, versus a 10.23% rise in the benchmark S&P 500 index during the same period.
About the Author: Samiksha Agarwal
Samiksha Agarwal has always had a keen interest in financial markets. This has led her to a career as a financial journalist. Through her extensive knowledge of fundamental analysis, her goal is to help investors identify untapped investment opportunities in the stock market. More...
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