Needham analysts on Wednesday reiterated their longstanding pair trade in the streaming video space: sell Netflix Inc (NASDAQ:NFLX) and buy Roku Inc (NASDAQ:ROKU).

Contrary to popular belief, Netflix is not an industry leader as streaming "merely the fifth form of delivery of TV" and the company very much competes against over-the-air, cable, satellite, as well as TV and film, Needham's Laura Martin wrote in a note.

Even if investors reject the claim that Netflix isn't a leader, the analyst lists a few catalysts suggest at the very least the stock should be sold:

• Momentum seen in 2020 is unsustainable ahead of a return of live sports and music festivals, among others. Also, billions of people were stuck at home in 2020 but next year could see a mass return to work and schools.
• Many subscribers Netflix added in 2020 were merely those pulled forward from 2021.
• More effective and lower-priced competitors that provide live broadcasts like the Olympics could see a rise in popularity at the expense of Netflix.
• Netflix's October U.S. price increase will negatively impact subscriber growth in 2021.

Related Link: Roku's Fundamentals 'Remain Strong,' Analyst Says

On the other hand, investors should be buyers of Roku's stock for a few reasons:

• Roku has benefited from a pull-forward of demand, but this means it now has more users for its ad-driven content.
• During the pandemic, advertisers had to pivot towards streaming video companies like Roku as cord-cutting trends accelerated.
• Roku boasts an attractive and lucrative younger demographic group for advertisers. Advertisers have no option but to reach out to Roku's base to grow their market share.

Martin maintains an Underperform rating on Netflix's stock and a Buy rating on Roku's stock with a $315 price target.

Price Action: Shares of Netflix closed down 3.7% at $493.60. Roku shares closed at $306.23, hitting a morning high north of the $328 level.