MoffettNathanson downgrades Roku to Sell, says market ‘too optimistic’

As previously reported, MoffettNathanson downgraded Roku (ROKU) to Sell from Neutral with a $55 price target on the view that the market is “too optimistic about Roku on several fronts.” A “big part of the move up” in shares has been driven by “specious and fanciful sell-side notes theorizing that Roku would be a likely acquisition target,” but the list of potential credible buyers “seems to be devoid of any real names,” the analyst argues. In addition, the firm’s prior upgrade of Roku to Neutral was based on a more positive view of platform gross margins, but the firm is doubtful there as well.