Shares of Roku, Inc. (NASDAQ: ROKU) fell by 1.2% on Friday, closing at $105.89 after reaching a low of $104.00 during the trading session. A total of 2,332,128 shares exchanged hands, marking a significant decline of 22% compared to the average volume of 2,976,121 shares. This decrease follows a previous closing price of $107.23.
Analyst Ratings Show Optimism
Despite the dip in share price, several analysts have recently adjusted their price targets for Roku. On December 11, 2023, Wedbush raised its target from $115.00 to $130.00, maintaining an “outperform” rating. Similarly, Pivotal Research increased its target from $120.00 to $135.00, issuing a “buy” rating on November 3, 2023.
On January 12, 2024, Bank of America lifted its price objective from $115.00 to $140.00. Meanwhile, KeyCorp reiterated an “overweight” rating with a target price of $116.00 on October 28, 2023. The consensus among analysts reflects a favorable outlook, with 22 analysts rating the stock as a Buy, five issuing a Hold rating, and one recommending Sell. Currently, the average rating stands at “Moderate Buy” with a target price of $118.79, according to MarketBeat.com.
Quarterly Earnings Exceed Expectations
Roku recently reported its quarterly earnings on October 30, 2023, revealing earnings per share of $0.16, surpassing the consensus estimate of $0.07 by $0.09. The company achieved total revenue of $1.21 billion for the quarter, consistent with analysts’ expectations and representing a 14% increase compared to the same period last year. Previously, Roku reported a loss of ($0.06) earnings per share during the same quarter in the prior year. Analysts project a slight decline, forecasting earnings per share of –0.3 for the current fiscal year.
Insider trading activities have also captured attention. Dan Jedda, the Chief Financial Officer, sold 3,000 shares on November 17, 2023, at an average price of $99.09, totaling $297,270. Post-sale, he retains 77,420 shares, valued at approximately $7.67 million. Additionally, Charles Collier, another insider, sold 118,088 shares on October 31, 2023, for $13.58 million at an average price of $115.00. Following this transaction, Collier’s stake dropped significantly to just 200 shares, valued at $23,000.
Over the past quarter, insiders have offloaded a total of 389,882 shares, valued at $42.25 million, resulting in insiders owning 13.98% of the company’s stock.
Institutional Investment Activities
Recent trading activity among institutional investors reflects ongoing interest in Roku. Apollon Wealth Management LLC increased its stake by 1.5% in the fourth quarter, now owning 6,450 shares valued at $700,000 after acquiring an additional 96 shares. GAMMA Investing LLC raised its stake by 9.5% during the third quarter, now holding 1,114 shares worth $112,000.
Another investor, Cornerstone Wealth Management LLC, increased its holdings by 3.8%, now owning 2,728 shares valued at $273,000. Thoroughbred Financial Services LLC boosted its position by 1.0%, owning 9,945 shares valued at $995,000. Finally, Aviance Capital Partners LLC grew its stake by 2.6%, now holding 4,172 shares valued at $418,000. Overall, institutional investors and hedge funds now control 86.30% of Roku’s shares.
Roku, founded in 2002 in California, has established itself as a key player in the streaming technology sector. The company continues to innovate, providing a platform that aggregates content from various streaming services, enhancing user experience across internet-connected devices and smart televisions.
