Roku (NASDAQ:ROKU) Shares Up 3.9% - Time to Buy?

Key Points

• Roku's shares increased by 3.9% to $90.89 after trading at a high of $91.00, despite a 73% drop in trading volume compared to the average.
• Analysts have varied ratings on Roku, with a consensus rating of Moderate Buy and a target price of $98.96, while some firms have set targets as high as $130.00.
• The company reported earnings of $0.07 per share for the last quarter, beating expectations, and achieved a 14.7% year-over-year revenue increase of $1.11 billion.

Roku, Inc. (NASDAQ:ROKU - Get Free Report)'s share price shot up 3.9% during trading on Friday . The stock traded as high as $91.00 and last traded at $90.89. 1,077,572 shares traded hands during trading, a decline of 73% from the average session volume of 4,000,547 shares. The stock had previously closed at $87.51.

Analyst Ratings Changes

Several research firms have commented on ROKU. Citigroup reissued a "neutral" rating and issued a $84.00 target price (up from $68.00) on shares of Roku in a research report on Wednesday, June 18th. Bank of America boosted their price objective on Roku from $100.00 to $110.00 and gave the stock a "buy" rating in a report on Thursday, July 3rd. Benchmark reissued a "buy" rating and set a $130.00 price objective on shares of Roku in a report on Friday, May 2nd. Evercore ISI dropped their price objective on Roku from $105.00 to $80.00 and set an "in-line" rating for the company in a report on Friday, May 2nd. Finally, Loop Capital raised Roku from a "hold" rating to a "buy" rating and upped their price target for the company from $80.00 to $100.00 in a research note on Tuesday, June 17th. One research analyst has rated the stock with a sell rating, seven have issued a hold rating, nineteen have assigned a buy rating and two have issued a strong buy rating to the company. According to data from MarketBeat, the stock has a consensus rating of "Moderate Buy" and a consensus target price of $98.96.

Roku Price Performance

The company has a market cap of $13.38 billion, a P/E ratio of -216.14, a PEG ratio of 12.33 and a beta of 2.05. The stock has a 50-day moving average of $85.95 and a 200 day moving average of $77.35.

Roku (NASDAQ:ROKU - Get Free Report) last released its earnings results on Thursday, July 31st. The company reported $0.07 earnings per share (EPS) for the quarter, beating analysts' consensus estimates of ($0.16) by $0.23. Roku had a negative return on equity of 2.44% and a negative net margin of 1.40%. The firm had revenue of $1.11 billion for the quarter, compared to analysts' expectations of $1.07 billion. During the same quarter in the previous year, the business posted ($0.18) earnings per share. The business's revenue for the quarter was up 14.7% on a year-over-year basis. Sell-side analysts predict that Roku, Inc. will post -0.3 EPS for the current year.

Insider Transactions at Roku

In related news, CAO Matthew C. Banks sold 3,360 shares of the company's stock in a transaction that occurred on Monday, August 4th. The stock was sold at an average price of $85.05, for a total value of $285,768.00. Following the sale, the chief accounting officer directly owned 5,195 shares in the company, valued at $441,834.75. This represents a 39.28% decrease in their ownership of the stock. The sale was disclosed in a legal filing with the SEC, which is available at this hyperlink. Also, CFO Dan Jedda sold 3,000 shares of the company's stock in a transaction that occurred on Tuesday, July 15th. The shares were sold at an average price of $90.20, for a total value of $270,600.00. Following the completion of the sale, the chief financial officer owned 76,132 shares in the company, valued at $6,867,106.40. The trade was a 3.79% decrease in their ownership of the stock. The disclosure for this sale can be found here. In the last three months, insiders have sold 337,233 shares of company stock valued at $30,423,181. 13.98% of the stock is currently owned by company insiders.

Hedge Funds Weigh In On Roku

A number of institutional investors and hedge funds have recently modified their holdings of ROKU. Moore Capital Management LP increased its holdings in shares of Roku by 2,464.1% during the second quarter. Moore Capital Management LP now owns 80,000 shares of the company's stock valued at $7,031,000 after acquiring an additional 76,880 shares in the last quarter. Man Group plc grew its holdings in Roku by 379.0% during the second quarter. Man Group plc now owns 456,708 shares of the company's stock worth $40,140,000 after buying an additional 361,357 shares in the last quarter. Maytus Capital Management LLC bought a new stake in Roku during the second quarter worth $4,757,000. Lazard Asset Management LLC grew its holdings in Roku by 16.5% during the second quarter. Lazard Asset Management LLC now owns 96,769 shares of the company's stock worth $8,504,000 after buying an additional 13,735 shares in the last quarter. Finally, Hudson Bay Capital Management LP grew its holdings in Roku by 1,417.2% during the second quarter. Hudson Bay Capital Management LP now owns 384,000 shares of the company's stock worth $33,750,000 after buying an additional 358,690 shares in the last quarter. 86.30% of the stock is currently owned by institutional investors.

About Roku

Roku, Inc, together with its subsidiaries, operates a TV streaming platform in the United states and internationally. The company operates in two segments, Platform and Devices. Its streaming platform allows users to find and access TV shows, movies, news, sports, and others. The Platform segment offers digital advertising, including direct and programmatic video advertising, media and entertainment promotional spending, and related services; and streaming services distribution, such as subscription and transaction revenue shares, and sale of premium subscriptions and branded app buttons on remote controls.

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