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KeyBanc Downgrades Roku Inc. (ROKU) to Sector Weight

November 29, 2022 3:27 AM EST
Get Alerts ROKU Hot Sheet
Price: $56.04 +6.58%

Rating Summary:
    15 Buy, 12 Hold, 7 Sell

Rating Trend: = Flat

Today's Overall Ratings:
    Up: 15 | Down: 21 | New: 16
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(Updated - November 29, 2022 3:46 AM EST)

KeyBanc analyst Justin Patterson downgraded Roku Inc. (NASDAQ: ROKU) from Overweight to Sector Weight.

The analyst comments "We are downgrading shares of Roku to Sector Weight as elements of our thesis -- 1) outsized growth in connected TV (CTV) advertising, and 2) critical platform for media partners -- have not manifested. In fact, Roku appears to be ceding market share, and has greater tech debt in its AdTech stack than we envisioned. As resolving these issues requires sustained investment, we believe consensus is too optimistic on 2023E/2024E revenue and gross profit growth (we are 7%/8% and 5%/10% below Street, respectively). We also believe this makes achieving profitability in 2024E challenging, which could exert further pressure on Roku's EV/S multiple (now at 1.9x/1.6x our 2023E/2024E forecasts)."

For an analyst ratings summary and ratings history on Roku Inc. click here. For more ratings news on Roku Inc. click here.

Shares of Roku Inc. closed at $53.91 yesterday.


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