The streaming industry has benefited from the remote lifestyle, with the increased adoption of internet-enabled entertainment platforms and surging demand. Technology advancements such as three-dimensional video platforms, virtual reality, and augmented reality have provided video streaming services with great growth prospects. Based on research by Strategy Analytics, U.S. viewers are expected to spend more time on digital streaming platforms than traditional TV. And spending on subscription streaming services (including VOD and virtual MVPDs) might reach $76.3 billion in 2024, surpassing traditional pay-tv.
According to a report by The Business Research Company, the global content streaming market size is projected to reach $227.32 billion in 2026, growing at a 16.6% CAGR. The increased number of devices that support digital media, internet connectivity, and advanced technologies are the main drivers of the market.
Roku, Inc. (ROKU)
ROKU in San Jose, Calif., operates a TV streaming platform together with its subsidiaries. The company operates through two segments: Platform; and Player. ROKU offers a platform to discover and access various movies and TV shows, digital and video advertising, subscription, and billing services, and sells and licenses smart TVs and streaming players.
On Feb. 8, 2022, The Old House Makers Channel launched a new linear channel exclusively on ROKU, which features leading makers and craftspeople in the industry displaying their skills. With the launch, ROKU is expected to increase its customer reach by gaining a new streaming audience and boosting revenues.
On Feb. 2, 2022, ROKU launched an advertising business in Mexico. As a part of the launch, the company partnered with Entravision, a leading digital marketing and media company, to allow brands and content providers to reach more consumers by advertising on the Roku streaming platform. The company might increase its client base and boost its revenue streams and profitability through advertisements.
In its fiscal third quarter, ended Sept. 30, 2021, ROKU’s total net revenue increased 50.5% year-over-year to $679.95 million. ROKU’s total gross margin grew 69.4% year-over-year to $363.92 million. The company’s income before taxes increased 453.3% year-over-year to $68.60 million. ROKU’s net income grew 432.4% year-over-year to $68.94 million. Its net income per share rose 433.3% year-over-year to $0.48.
The $896.75 million consensus revenue estimate for its fourth quarter, ended Dec.31, 2021, represents 38% year-over-year growth.
Over the past five days, the stock has increased 7.3% in price to close yesterday’s trading session at $155.86.
Of the 15 Wall Street analysts that rated ROKU, 12 rated it Buy, while three rated it Sell. The 12-month median price target of $284.00 indicates an 82.2% potential upside. The price targets range from a low of $136.00 to a high of $400.00.
fuboTV Inc. (FUBO)
Headquartered in New York, FUBO is a live TV streaming platform in the U.S. and Europe. It streams live sports events, news, and entertainment content. The company allows customers to access content through different streaming devices, including SmartTVs, computers, mobile phones, and tablets.
On Feb. 08, 2022, FUBO’s Fubo Gaming partnered with Cleveland Cavaliers to become the Cavs’ Official Mobile Sports Betting Partner. Fubo Gaming’s Fubo Sportsbook will launch an integrated streaming and wagering sports platform to cater to the audience in Ohio. This partnership might provide instant access to an attractive customer base, increased margins, and revenue streams.
Last week, FUBO announced an agreement with NBCUniversal to provide a multi-platform content offering for NBCUniversal’s coverage of the 2022 Olympic Winter Games, which are being held Feb.2-20, 2022. FUBO’s subscribers will access 2,100 hours of Winter Olympics coverage of all competition sessions, live and on-demand. This is expected to increase the company’s customer reach and profitability.
FUBO’s total revenues increased 156% year-over-year to $156.69 million in its fiscal third quarter of 2021 ended Sept. 30, 2021. The company’s cash and cash equivalents increased 191.3% over the period of nine months ended Sept. 30, 2021, to come in at $393.13 million. FUBO’s total assets grew 35% over nine months to $1.16 billion.
The $212.47 million consensus revenue for its fiscal fourth quarter, ended December 31, 2021, represents 102.2% year-over-year growth. The Street expects FUBO’s EPS to improve 75.7% year-over-year in the about-to-be-reported quarter. The company has an impressive earnings surprise history; it surpassed the consensus EPS estimates in three of the trailing four quarters.
Over the past five days, OUST shares have gained 3.1% in price.
Both Wall Street analysts that rated OUST rated it Buy. The 12-month median price target of $28.83 indicates a 188.3% potential upside from yesterday’s closing price of $10.00. The price targets range from a low of $15.00 to a high of $40.00.
CuriosityStream Inc. (CURI)
CURI is a streaming service and media company. It offers premium video programming services in various categories of factual entertainment content, including science, history, society, lifestyle, and technology. The Silver Spring, Md.-based company has more than 16 million subscribers, including direct subscribers, direct partner subscribers, and bundled MVPD subscribers.
Last December, CURI launched an enhanced premium tier offering, the Smart Bundle. With it,premium tier customers and existing CURI subscribers gained instant access to leading subscription services Tastemade+, SommTV, Topic, One Day University, and Nebula. This integration is expected to generate additional revenue for CURI.
Earlier in December, CURI entered multiple distribution partnerships with Viaplay in the Nordic and Baltic regions, EI Espectador in Colombia, Telekom Slovenije in Central Eastern Europe, and Shanghai Media Group and CCTV in China. Through these partnerships, CURI might expand globally to more than 3 million new subscribers across new countries and territories and boost the company’s revenue streams.
CURI’s revenues increased 113.9% year-over-year to $18.71 million in its fiscal third quarter of 2021, ended Sept. 30, 2021. CURI’s income before taxes grew 113.2% year-over-year to $0.88 million. And the company’s net income increased 112.4% year-over-year to $0.83 million.
Analysts expect CURI’s revenue for its fiscal fourth quarter, ending Dec. 31, 2021, to come in at $27 million, representing a 137.7% rise year-over-year. Analysts expect CURI’s EPS to improve 68.2% year-over-year in the about-to-be-reported quarter.
The stock has slumped 34.9% in price year-to-date. However, CURI’s 12-month median price target of $10.25 indicates a 165.5% potential upside from yesterday’s closing price of $3.86. Each of the four Wall Street analysts that rated CURI rated it Buy. The price targets range from a low of $6.00 to a high of $15.00.
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ROKU shares were trading at $162.42 per share on Wednesday afternoon, up $6.56 (+4.21%). Year-to-date, ROKU has declined -28.83%, versus a -4.06% rise in the benchmark S&P 500 index during the same period.
About the Author: Mangeet Kaur Bouns
Mangeet’s keen interest in the stock market led her to become an investment researcher and financial journalist. Using her fundamental approach to analyzing stocks, Mangeet’s looks to help retail investors understand the underlying factors before making investment decisions. More...
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