Why Is Roku Stock Falling Today?

Roku (NASDAQ:ROKU) stock fell in the pre-market trading session today. Roku fell 4.2% in today’s trading session at 9:59 AM ET. The stock fell after existing holders reduced stake in the company through an unregistered block. According to a report from TheFly, Morgan Stanley re-offered about 6 million shares in the range of $57.50–$59.00, which represents about a 7.6%–10% discount to Monday’s closing price of $63.84. However, the identity of the seller is unknown at the time of writing this article.

On Monday, Roku stock fell 21.1% and closed at $63.84. Based on the last closing price, the company has a market cap of $7.7 billion. The stock price has fallen by 33.7% in the trailing five-day period, while it has risen 1.7% in the trailing 12-month period.

As of Monday, 19 analysts cover Roku stock. Among the analysts, 13 or ~68.4% recommend a “buy,” three or ~15.8% recommend a “hold,” and the remaining three or ~15.8% recommend a “sell.”

Analysts have an average target price of $151.72 on Roku. The target price implies a return of 137.7% based on the closing price of $63.84 on Monday. The consensus target price for the stock has fallen from $152.10 in the previous month.

Roku stock is trading 63.8% below its 52-week high of $176.55 on September 9, 2019. The stock was also trading 16.0% above its 52-week low of $55.02 on April 18, 2019. On a year-to-date basis, the stock has fallen by 52.3% as of Monday.

On Monday, Roku stock was trading 37.7% below its 20-day moving average of $102.55. Meanwhile, the stock is trading 46.8% below its 50-day moving average of $119.98 and 51.5% below its 100-day moving average of $131.63. The stock’s 14-day relative strength index score of 17 shows that the stock is oversold.

Roku has an upper Bollinger Band level of $138.90. The company’s middle Bollinger Band level is $105.92, while its lower Bollinger Band level is $72.94. On Monday, the stock closed near its lower Bollinger Band level, which also indicates that the stock is oversold.

In the fourth quarter of 2019, Roku’s revenue of $411.23 million beat Wall Street analysts’ consensus estimates by 5.0%. The company’s revenue rose 49.1% YoY (year-over-year) in the fourth quarter of 2019. Roku’s adjusted earnings of -$0.13 were above analysts’ estimates of -$0.14. Read Why Roku Stock Fell after Its Q4 Earnings to learn more.

Today, the Dow Jones Industrial Average was up about 0.04% at 10:55 AM ET. Also, the S&P 500 and the Nasdaq Composite rose about 1.98% and 2.03%, respectively.