Roku (NASDAQ:ROKU) Shares Gap Up – Should You Buy?

Shares of Roku, Inc. (NASDAQ:ROKU) gapped up before the market opened on Tuesday . The stock had previously closed at $79.91, but opened at $84.20. Roku shares last traded at $83.91, with a volume of 609,013 shares trading hands.

Analyst Upgrades and Downgrades

A number of analysts have commented on ROKU shares. Morgan Stanley boosted their price objective on Roku from $60.00 to $65.00 and gave the stock an “underweight” rating in a report on Tuesday, October 29th. Baird R W raised Roku from a “hold” rating to a “strong-buy” rating in a research report on Monday, November 18th. Benchmark reaffirmed a “buy” rating and set a $105.00 price objective on shares of Roku in a report on Thursday, September 12th. Macquarie reiterated an “outperform” rating and issued a $90.00 target price on shares of Roku in a research note on Thursday, October 31st. Finally, Citigroup raised their price target on shares of Roku from $60.00 to $77.00 and gave the company a “neutral” rating in a research report on Wednesday, September 25th. Two research analysts have rated the stock with a sell rating, nine have issued a hold rating, twelve have given a buy rating and one has assigned a strong buy rating to the company. According to MarketBeat, the company has an average rating of “Moderate Buy” and an average price target of $83.81.

Roku Stock Performance

The firm has a market capitalization of $12.05 billion, a P/E ratio of -69.17 and a beta of 2.05. The stock has a 50 day moving average of $75.50 and a 200-day moving average of $69.71.

Roku (NASDAQ:ROKU) last posted its quarterly earnings results on Wednesday, October 30th. The company reported ($0.06) earnings per share (EPS) for the quarter, beating the consensus estimate of ($0.35) by $0.29. The company had revenue of $1.06 billion for the quarter, compared to analyst estimates of $1.02 billion. Roku had a negative net margin of 4.42% and a negative return on equity of 7.22%. The company’s quarterly revenue was up 16.5% compared to the same quarter last year. During the same quarter in the previous year, the firm posted ($2.33) earnings per share. As a group, sell-side analysts expect that Roku, Inc. will post -1.1 EPS for the current year.

Insider Transactions at Roku

In other news, CFO Dan Jedda sold 1,000 shares of the firm’s stock in a transaction that occurred on Monday, December 16th. The shares were sold at an average price of $82.73, for a total value of $82,730.00. Following the completion of the transaction, the chief financial officer now directly owns 64,555 shares in the company, valued at approximately $5,340,635.15. This trade represents a 1.53 % 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 the SEC website. Also, CEO Anthony J. Wood sold 25,000 shares of the company’s stock in a transaction that occurred on Tuesday, December 10th. The stock was sold at an average price of $82.64, for a total transaction of $2,066,000.00. Following the sale, the chief executive officer now directly owns 26,538 shares in the company, valued at $2,193,100.32. This trade represents a 48.51 % decrease in their position. The disclosure for this sale can be found here. Insiders sold 48,095 shares of company stock valued at $3,731,038 over the last three months. Company insiders own 13.98% of the company’s stock.

Institutional Investors Weigh In On Roku

Several large investors have recently added to or reduced their stakes in the business. Raelipskie Partnership purchased a new stake in shares of Roku in the 3rd quarter valued at about $32,000. Future Financial Wealth Managment LLC bought a new position in shares of Roku in the third quarter worth approximately $43,000. GS Investments Inc. raised its stake in Roku by 33.4% in the third quarter. GS Investments Inc. now owns 587 shares of the company’s stock valued at $44,000 after purchasing an additional 147 shares in the last quarter. EverSource Wealth Advisors LLC increased its stake in Roku by 123.4% in the 2nd quarter. EverSource Wealth Advisors LLC now owns 679 shares of the company’s stock worth $40,000 after purchasing an additional 375 shares during the period. Finally, Cedar Wealth Management LLC bought a new stake in Roku in the second quarter valued at approximately $48,000. Institutional investors own 86.30% of the company’s stock.

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.