Roku (NASDAQ:ROKU) Trading Down 3.9% - Time to Sell?

Key Points

• Roku shares fell 3.9% in mid-day trading, briefly touching $119.49 before last trading at $122.20, with volume running below average.
• Despite the drop, Wall Street remains largely positive: 22 analysts rate Roku a Buy, four rate it Hold, and the average price target is $144.46.
• The company reported strong quarterly results, posting $0.57 EPS versus $0.34 expected and 22.4% revenue growth year over year, while insiders have also been active sellers recently.

Roku, Inc. (NASDAQ:ROKU - Get Free Report)'s share price was down 3.9% during mid-day trading on Wednesday . The company traded as low as $119.49 and last traded at $122.20. Approximately 2,355,785 shares were traded during mid-day trading, a decline of 23% from the average daily volume of 3,062,911 shares. The stock had previously closed at $127.12.

Wall Street Analyst Weigh In

ROKU has been the subject of several analyst reports. UBS Group set a $170.00 price target on shares of Roku in a research report on Thursday, May 28th. Jefferies Financial Group increased their price target on shares of Roku from $135.00 to $140.00 and gave the company a "buy" rating in a research report on Monday, April 13th. Zacks Research cut shares of Roku from a "strong-buy" rating to a "hold" rating in a research report on Tuesday, April 14th. Benchmark increased their price target on shares of Roku from $130.00 to $160.00 and gave the company a "buy" rating in a research report on Friday, May 1st. Finally, Needham & Company LLC increased their price target on shares of Roku from $110.00 to $140.00 and gave the company a "buy" rating in a research report on Friday, May 1st. Twenty-two equities research analysts have rated the stock with a Buy rating and four have issued a Hold rating to the company's stock. According to data from MarketBeat, Roku currently has an average rating of "Moderate Buy" and an average target price of $144.46.

Roku Trading Down 3.9%

The firm has a market capitalization of $18.02 billion, a P/E ratio of 91.88 and a beta of 2.06. The company's fifty day simple moving average is $113.01 and its 200 day simple moving average is $104.54.

Roku (NASDAQ:ROKU - Get Free Report) last issued its quarterly earnings data on Thursday, April 30th. The company reported $0.57 EPS for the quarter, topping the consensus estimate of $0.34 by $0.23. Roku had a net margin of 4.06% and a return on equity of 7.64%. The business had revenue of $1.25 billion during the quarter, compared to analyst estimates of $1.20 billion. During the same period in the prior year, the business earned ($0.19) EPS. The company's revenue for the quarter was up 22.4% on a year-over-year basis. On average, analysts predict that Roku, Inc. will post 2.41 earnings per share for the current fiscal year.

Insider Activity at Roku

In other Roku news, CEO Anthony J. Wood sold 75,000 shares of the company's stock in a transaction on Monday, May 11th. The shares were sold at an average price of $128.79, for a total value of $9,659,250.00. The sale was disclosed in a document filed with the Securities & Exchange Commission, which can be accessed through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, insider Charles Collier sold 205,821 shares of the company's stock in a transaction on Wednesday, April 8th. The stock was sold at an average price of $105.00, for a total transaction of $21,611,205.00. Following the completion of the transaction, the insider owned 11,131 shares of the company's stock, valued at $1,168,755. This trade represents a 94.87% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders have sold a total of 681,358 shares of company stock valued at $75,642,627 over the last quarter. Company insiders own 13.45% of the company's stock.

Institutional Inflows and Outflows

Several institutional investors have recently modified their holdings of the business. Vanguard Group Inc. increased its stake in shares of Roku by 2.5% in the 3rd quarter. Vanguard Group Inc. now owns 12,998,674 shares of the company's stock worth $1,301,557,000 after acquiring an additional 322,858 shares in the last quarter. AQR Capital Management LLC increased its stake in shares of Roku by 10.6% in the 4th quarter. AQR Capital Management LLC now owns 2,860,149 shares of the company's stock worth $310,298,000 after acquiring an additional 274,024 shares in the last quarter. Geode Capital Management LLC increased its stake in shares of Roku by 7.3% in the 4th quarter. Geode Capital Management LLC now owns 2,464,130 shares of the company's stock worth $267,389,000 after acquiring an additional 168,214 shares in the last quarter. Arrowstreet Capital Limited Partnership increased its stake in shares of Roku by 229.5% in the 1st quarter. Arrowstreet Capital Limited Partnership now owns 2,038,347 shares of the company's stock worth $192,868,000 after acquiring an additional 1,419,772 shares in the last quarter. Finally, Holocene Advisors LP increased its stake in shares of Roku by 352.3% in the 3rd quarter. Holocene Advisors LP now owns 1,650,448 shares of the company's stock worth $165,259,000 after acquiring an additional 1,285,585 shares in the last quarter. 86.30% of the stock is currently owned by 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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