Roku (NASDAQ:ROKU) CAO Matthew Banks Sells 725 Shares

Key Points

• Insider sale: Roku CAO Matthew Banks sold 725 shares under a pre-arranged Rule 10b5-1 plan at an average price of $125.52 for $91,002, leaving him with 6,222 shares (a reported 10.44% decrease in his ownership).
• Q1 earnings beat: Roku reported Q1 EPS of $0.57 versus $0.34 expected and revenue of $1.25 billion (up 22.4% year-over-year), with platform revenue surging and record free cash flow.
• Mixed outlook: Analysts have lifted price targets (average target ~$142.17 with many Buy ratings), but Roku faces legal and reputational risk from class-action lawsuits alleging software updates "bricked" TCL TVs.

Roku, Inc. (NASDAQ:ROKU - Get Free Report) CAO Matthew Banks sold 725 shares of the company's stock in a transaction on Friday, May 1st. The shares were sold at an average price of $125.52, for a total transaction of $91,002.00. Following the sale, the chief accounting officer owned 6,222 shares of the company's stock, valued at $780,985.44. This represents a 10.44% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which can be accessed through this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan.

Roku Stock Performance

NASDAQ:ROKU traded down $1.58 during midday trading on Tuesday, reaching $124.44. 2,822,132 shares of the stock traded hands, compared to its average volume of 3,312,268. The company has a fifty day moving average of $101.11 and a 200 day moving average of $101.06. Roku, Inc. has a 12 month low of $58.77 and a 12 month high of $127.90. The stock has a market capitalization of $18.35 billion, a P/E ratio of 93.57 and a beta of 2.04.

Roku (NASDAQ:ROKU - Get Free Report) last announced its quarterly earnings results on Thursday, April 30th. The company reported $0.57 earnings per share (EPS) for the quarter, beating analysts' consensus estimates of $0.34 by $0.23. Roku had a return on equity of 7.68% and a net margin of 4.06%.The company had revenue of $1.25 billion for the quarter, compared to the consensus estimate of $1.20 billion. During the same quarter in the previous year, the business earned ($0.19) EPS. Roku's revenue was up 22.4% compared to the same quarter last year. On average, analysts predict that Roku, Inc. will post 2.24 EPS for the current fiscal year.

Roku News Roundup

Here are the key news stories impacting Roku this week:

• Positive Sentiment: Q1 earnings beat — Roku reported stronger-than-expected Q1 revenue and EPS with platform revenue surging and record free cash flow, supporting the company's ad/subscription monetization thesis. ROKU Shares Rise 6% on Q1 Earnings Beat, Revenues and EPS Up Y/Y
• Positive Sentiment: Content and distribution additions — Roku added 15 new free channels to its platform, which can increase engagement, ad inventory and potential ad revenue. Roku Just Added 15 New Channels — And They’re All Free
• Positive Sentiment: New low-cost subscription (Howdy) — Roku’s Howdy $3/month service is getting coverage as a viable low-price add-on that could drive ARPU and reduce churn if adoption scales. Here’s Why Howdy, Roku’s Low-Cost Streaming Service, Is Worth Your $3/Month
• Positive Sentiment: Structural cost/market tailwind — analysis suggests Roku’s low-memory hardware footprint may benefit it amid rising memory prices, potentially protecting margins vs. peers. How ROKU Stock Could Be One of the Biggest Winners of Sky-High Memory Prices
• Neutral Sentiment: Analyst update — Citigroup raised its price target to $120 but kept a "neutral" rating, signaling mixed analyst sentiment and implying limited near-term upside from that house. Benzinga coverage of analyst update
• Negative Sentiment: Class-action lawsuits alleging updates “bricked” TCL TVs running Roku software — multiple outlets report a new suit accusing Roku (with TCL) of shipping updates that rendered devices unusable; litigation and reputational risk could pressure the stock and lead to legal costs or remedial expenses. TCL and Roku sued for allegedly bricking TVs with updates Roku and TCL are being sued for allegedly bricking smart TVs ROKU and TCL accused of bricking TVs in new class action lawsuit

Analyst Ratings Changes

A number of brokerages recently issued reports on ROKU. Bank of America boosted their price target on Roku from $115.00 to $140.00 and gave the company a "buy" rating in a report on Monday, January 12th. Arete Research set a $132.00 price target on shares of Roku and gave the company a "buy" rating in a report on Monday, January 5th. Wells Fargo & Company lifted their price target on shares of Roku from $137.00 to $167.00 and gave the company an "overweight" rating in a report on Friday. Rosenblatt Securities lifted their price target on shares of Roku from $118.00 to $150.00 and gave the company a "buy" rating in a report on Friday. Finally, Evercore reiterated an "outperform" rating and issued a $150.00 price target on shares of Roku in a report on Friday, February 13th. Twenty-one investment analysts have rated the stock with a Buy rating and five have assigned a Hold rating to the company's stock. Based on data from MarketBeat.com, Roku presently has an average rating of "Moderate Buy" and an average price target of $142.17.

Institutional Trading of Roku

Several institutional investors and hedge funds have recently bought and sold shares of the stock. Illinois Municipal Retirement Fund lifted its holdings in Roku by 28.9% in the first quarter. Illinois Municipal Retirement Fund now owns 61,406 shares of the company's stock worth $5,810,000 after buying an additional 13,764 shares during the period. Katamaran Capital LLP raised its holdings in Roku by 90.8% in the first quarter. Katamaran Capital LLP now owns 52,548 shares of the company's stock worth $4,972,000 after purchasing an additional 25,002 shares in the last quarter. Hillsdale Investment Management Inc. raised its holdings in Roku by 15.6% in the first quarter. Hillsdale Investment Management Inc. now owns 55,480 shares of the company's stock worth $5,250,000 after purchasing an additional 7,500 shares in the last quarter. Empirical Financial Services LLC d.b.a. Empirical Wealth Management bought a new position in Roku in the first quarter worth $361,000. Finally, Chicago Partners Investment Group LLC raised its holdings in Roku by 56.8% in the first quarter. Chicago Partners Investment Group LLC now owns 10,490 shares of the company's stock worth $993,000 after purchasing an additional 3,802 shares in the last quarter. 86.30% of the stock is currently owned by hedge funds and other institutional investors.

About Roku

Roku, Inc NASDAQ: ROKU is a technology company that develops and operates a proprietary streaming platform designed to deliver entertainment content to consumers via internet-connected devices and smart televisions. Since its inception in 2002 in California, Roku has focused on simplifying access to streaming services for viewers worldwide. The company's platform enables users to discover, access and manage a wide array of over-the-top content from major streaming services, free ad-supported channels and niche providers.

At the core of Roku's product lineup are a range of streaming players and sticks, which connect to televisions via HDMI and deliver the Roku OS experience.

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