Market Overview

Roku Analyst Warns Short Sellers To Close Their Positions

Share:
Roku Analyst Warns Short Sellers To Close Their Positions
Related ROKU
Citi Slashes Roku Price Target, Names 5 Reasons For Staying Neutral
10 Biggest Price Target Changes For Monday

Citron Research's Andrew Left laid out the case for shorting Roku Inc (NASDAQ: ROKU) in late 2017 and debated Needham's Laura Martin, who took the other side of the trade. On Feb. 2, Martin released a new report that warned short sellers to close their position in Roku for six reasons.

The Analyst

Needham's Martin maintains a Buy rating on Roku's stock with an unchanged $50 price target. (See the analyst's track record here.) 

The Thesis

Martin named six reasons for closing short Roku positions: 

  • Roku's fourth-quarter earnings report Feb. 21 could "over-deliver."
  • Roku's strategic position within the streaming video space is improving.
  • Roku's moats are also improving.
  • With a $4-billion market cap, Roku's stock "should be added" to the S&P indices in March and Russell indices in June, resulting in passive money managers "buying for the first time." 
  • Roku's valuation on a sales, OIBDA, P/E and free cash flow basis makes the stock "inexpensive."
  • Expectations for Roku to be acquired by a larger company remain high given the stock's market cap of $4 billion versus $115 billion for Netflix, Inc. (NASDAQ: NFLX).

Price Action

Shares of Roku were trading lower by 1.6 percent Monday morning.

Related Links:

Citi Analyst Sees Roku Falling 45%, Downgrades To Sell

Roku Falls After Morgan Stanley Says Long-Term Earnings Potential Isn't Clear

Photo courtesy of Roku. 

Latest Ratings for ROKU

DateFirmActionFromTo
Jan 2019CitigroupMaintainsNeutralNeutral
Dec 2018KeyBancMaintainsOverweightOverweight
Dec 2018SunTrust Robinson HumphreyInitiates Coverage OnHold

View More Analyst Ratings for ROKU
View the Latest Analyst Ratings

Posted-In: Andrew Left Citron Research Laura MartinAnalyst Color Short Sellers Price Target Reiteration Analyst Ratings Best of Benzinga

 

Related Articles (NFLX + ROKU)

View Comments and Join the Discussion!

Latest Ratings

StockFirmActionPT
MDRXKeyBancUpgrades0.0
ANETNomuraUpgrades260.0
CNPRBC CapitalUpgrades34.0
FISVOppenheimerUpgrades88.0
FNDUBSUpgrades37.0
View the Latest Analytics Ratings
Don't Miss Out!
Join Our Newsletter
Subscribe to:
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Daily Analyst Rating
A summary of each day’s top rating changes from sell-side analysts on the street.
Fintech Focus
Your weekly roundup of hot topics in the exciting world of fintech.
Thank You
for registering for Benzinga’s newsletters and alerts.
• The Daily Analysts Ratings email will be received daily between 7am and 10am.
• The Market in 5 Minutes email will be received daily between 7am and 8am.
• The Fintech Focus email will be received every Friday between 2pm and 5pm.

7 Biggest Price Target Changes For Monday

Benzinga Pro's 5 Stocks To Watch Today