The high-flying OTT streaming platform Roku was slowed on Tuesday after “neutral” support was given by one analyst.
Roku’s stock price was down more than 6% in early Tuesday trading to $89.78. Roku’s stock has been up 250% since last December and 50% higher for the month of May.
At the beginning of the year, Roku’s stock was trading at $29.82.
Kyle Evans, media analyst for Stephens, says that while the fundamentals of the company continue to be “strong,” the valuation of the Roku’s stock price has grown to a high risk level.
For some time, Roku has been viewed as the leading set-top device/platform for streaming TV video and apps in the U.S.
But at an industry conference recently, an Amazon executive revealed that the company's set-top-box streaming platform, Amazon Fire TV, now says it has 34 million users — making it the leading OTT platform, overtaking Roku.
Earlier this year, Roku said it had 29.1 million “active accounts” -- 2 million higher than cited in a previous company release. In one estimate, eMarketer says Roku ad revenues will grow to $632.9 million in 2020 from $433 million in ad revenues in 2019 -- with much of this coming from the Roku Channel.
Overall 2018 annual revenue for Roku grew 45% to $742.5 million from the year before.