Categories Analysis, Finance, Technology

Roku stock gains sharply, buoyed by robust user growth in Q4

Shares of TV-streaming service Roku, Inc. (ROKU) rose sharply Monday after the management released its bullish estimate for the fourth quarter, marked by a 40% growth in the number of active accounts. The preliminary results, announced in the run-up to the company’s presentation at the Consumer Electronics Show in Las Vegas, showed that the number of streaming hours surged 68% to 7.3 billion hours during the quarter. The outcome far exceeded analysts’ forecast.

Taking a cue from the steady growth of the over-the-top video streaming business and Roku’s expanding user base, market watchers expect that the ongoing recovery will gather further momentum in the coming weeks, which makes the stock an ideal investment option.

The number of streaming hours surged 68% to 7.3 billion hours in the fourth quarter, surpassing analysts’ forecast

The impressive user count will attract more advertisers and content providers who want to use Roku’s platform as a medium. However, investors are cautioned that uncertainties associated with the Beijing-Washington trade war could play spoilsport, reversing the current rally and dragging the stock to the lows seen last month. Most of the analysts who cover Roku recommend a buy, followed by overweight. Their average price target is $59.62.

The final results for the fourth quarter are scheduled to be released in the first week of next month. Earlier in the day, Roku said television manufacturer Westinghouse Electronics will join its TV licensing program.

Roku stock rises as it adds premium subscriptions to The Roku Channel

Roku’s TV streaming hardware allows viewers to access and search a huge collection of movies and videos on multiple streaming platforms, offering a hassle-free viewing experience in a cost-effective manner.

Also Read:  What lies ahead for Wells Fargo (WFC) after a COVID-19-hit quarter

Roku shares have been in a free fall since October last year after hitting a record high. They opened Monday’s trading sharply higher and gained about 24%. Registering one of the biggest intra-day gains in recent times, the stock crossed the $40-mark during the session after staying below that level for more than a month.

 

We’re on Flipboard! Follow us to receive the latest stock market, earnings, and financial news at your fingertips

Most Popular

Levi Strauss (LEVI): Digital maintains momentum amid pandemic-induced store closures

Amid the COVID-19 pandemic, several retailers were forced to close their stores but in turn witnessed a pickup in their digital business. Levi Strauss & Co. (NYSE: LEVI) is the

Mattel’s (MAT) transformation plan will depend on how pandemic plays out

The ongoing market turmoil has upset the growth strategy set by Mattel, Inc. (NASDAQ: MAT), with focus on transitioning into an IP-driven company. Currently, the maker of legendary brands like

Lemonade (LMND): A successful IPO of 2020

The usage of artificial intelligence (AI) has accelerated rapidly in the fintech industry. Many insurance companies are using AI to compete with their competitors. These insurance companies use AI in

Top