Roku (NASDAQ:ROKU) Shares Decline by 4.3% – Here's the Situation

On Monday, Roku, Inc. (NASDAQ:ROKU) experienced a drop in share price, declining by 4.3%. The stock reached a low of $73.31 during the trading session, before closing at $73.74. Overall, 549,688 shares changed hands on that day, marking an 87% decrease in volume compared to the normal average session volume of 4,313,999 shares. Previously, the stock had closed at $77.03.

Recent Changes in Analyst Ratings

Several analysts have recently reassessed their perspectives on Roku shares. Citigroup raised its price target from $60.00 to $77.00 and gave the company a 'neutral' rating in a report dated September 25th. Wells Fargo & Company adjusted its target price from $72.00 to $74.00 while maintaining an 'equal weight' rating as of October 31st. Bank of America increased its price target from $75.00 to $90.00 and designated the stock with a 'buy' rating on September 30th. Furthermore, Baird R W upgraded Roku from a 'hold' to a 'strong buy' rating on November 18th. Benchmark reaffirmed a 'buy' rating and set a price objective of $105.00 for Roku shares on September 12th. Overall, two analysts have given the stock a sell rating, nine have rated it hold, twelve are on the buy side, and one analyst has assigned a strong buy rating. MarketBeat reports that Roku has a consensus rating of 'Moderate Buy' with an average price target of $83.81.

Performance Overview of Roku

Currently, Roku has a market capitalization of $10.91 billion, a PE ratio of -62.60, and a beta of 2.06. The company’s fifty-day moving average stands at $75.42, while the 200-day moving average is $68.60. On October 30th, Roku announced its quarterly earnings, reporting an EPS of ($0.06), which exceeded analysts' expectations of ($0.35) by $0.29. The company recorded revenue of $1.06 billion for the quarter, surpassing the consensus estimate of $1.02 billion. However, Roku also reported a negative return on equity of 7.22% and a negative net margin of 4.42%. Year-over-year, revenue rose by 16.5% compared to the same quarter last year, when the company reported ($2.33) EPS. Analysts predict that Roku will report an EPS of -1.1 for the current fiscal year.

Insider Transactions

In recent insider activity, CEO Anthony J. Wood sold 25,000 shares of the company on October 10th at an average price of $77.20, totaling $1,930,000. Following this transaction, Wood retains ownership of 5,020 shares valued at around $387,544. This sale represented a significant 83.28% decrease in his holdings. The transaction was disclosed in documentation submitted to the Securities and Exchange Commission. Additionally, CAO Matthew C. Banks sold 8,693 shares at an average price of $71.44 on November 18th, for a total of $621,027.92. After this sale, he directly owns 7,264 shares worth approximately $518,940.16, reflecting a 54.48% decline in his ownership. Over the last ninety days, corporate insiders have sold a total of 73,096 shares valued at $5,661,223. Currently, corporate insiders hold 13.98% of the company's stock.

Institutional Investment Trends

Recent changes in institutional investor positions have also been noteworthy. Raelipskie Partnership acquired a new stake in Roku during the third quarter, valued at about $32,000. EverSource Wealth Advisors LLC boosted its Roku holdings by 123.4% in the second quarter and now possesses 679 shares worth $40,000 after acquiring an additional 375 shares. Future Financial Wealth Management LLC also entered a new position during the third quarter, valued at around $43,000. GS Investments Inc. increased its holdings in Roku by 33.4% in the same quarter, now owning 587 shares worth $44,000. Lastly, Cedar Wealth Management LLC acquired a new stake in Roku in the second quarter valued at $48,000. It’s important to note that institutional investors own a significant 86.30% of Roku’s stock.

About Roku, Inc.

Roku, Inc. operates a streaming platform for television content both in the United States and internationally. Its business divides into two segments: Platform and Devices. The streaming platform enables users to discover and access a variety of TV shows, movies, news, and sports. The Platform segment primarily revolves around digital advertising, including direct and programmatic video ads, alongside various media and entertainment promotional spending and related services.

Roku, Trading, Shares