Roku stock jumps after 'three pieces of good news,' says Needham

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  1. sniper-academy

    sniper-academy Administrator Staff Member

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    Shares of Roku Inc. are up 8.1% in premarket trading after the company announced on Monday afternoon that it was making Walt Disney Co.'s new ESPN+ streaming service available on its devices. Roku also said in a Monday filing that Stephen A. Cohen's Point72 Asset Management had taken a 5.1% stake in the company. Finally, Needham analyst Laura Martin reiterated her bullish stance on Roku shares in a pair of notes to clients following Netflix Inc.'s strong earnings report, one of which was entitled "If you like Netflix, buy Roku." Martin said that Netflix's results show "growing broadband adoption globally and a shift of viewing away from TVs and toward [over-the-top] and digital channels," which Roku benefits from as well, though its stock isn't as expensive as Netflix's. Martin wrote that Roku may get paid $1 per month for every ESPN+ subscriber who signs up from a Roku device, and she said that Disney is likely to spend millions on "audience development" on Roku to market its new service. Roku shares are down 21% over the past three months, while the S&P 500 has lost 4.5%.

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