Roku Romps; FireEye’s Red Scare; Overweight Mouse
All Roads Lead to Roku
Streaming roads, take me home … to the place I belong!
Movie dramas with mountain mamas. Take me home, streaming roads.
John Denver? In Great Stuff? Will wonders never cease?
Yeah, well … I’ve watched a lot of The Queen’s Gambit on Netflix lately. Main character Grace hails from my home in the Bluegrass state, and chess always interested me. “Country Roads” just kinda fit this morning.
Granted, most of Kentucky is devoid of mountains. But I grew up driving country roads that’d make even the most aggressive chess matches look tame.
But I didn’t come here today to give you a tour of Kentucky. We’ll save that for another time.
No, I came to talk about streaming media, specifically Roku (Nasdaq: ROKU) — as you might’ve guessed from the headline up above.
I have two rather tasty tidbits for Roku investors today. First, analysts at Citi reiterated their buy rating on ROKU and lifted their price target from $220 to $375. That’s a 20% upside from yesterday’s close. Nice!
According to Citi, the addition of Discovery+ (a favorite of a certain Great Stuff team member) and a potential HBO Max deal are significant catalysts for Roku. Citi also highlighted the company’s international expansion as a major growth opportunity.
Second, raging Roku bull and Needham Analyst Laura Martin recently talked about Roku’s streaming dominance backed by Pixalate’s analytics.
Martin highlighted a Pixalate data point that said Roku devices accounted for “49% of total placement of CTV programmatic ads” in the third quarter. CTV, in this case, means “connected TV.”
In other words, Pixalate’s data indicate that Roku commands half of the ad placement revenue for TV streaming devices. Martin estimates that Pixalate is “tracking a total of about $2B of programmatic ad revs for 2020,” which puts $1 billion of ad spending in Roku’s pocket.
That’s big … just unbelievably huge if true. Martin doesn’t believe it, however, noting that “this seems too high.”
Too high or not, it’s clear that Roku is the streaming company to beat.
Even more reason for AT&T to pull its head out of its *ahem* and sign an HBO Max deal ASAP. Not that it’d placate director Christopher Nolan or anything.
For Great Stuff Picks readers, Roku’s rise to the top of the streaming heap means a more than 260% gain since we first recommended the stock back in May 2019. If you missed the first rec but got in on the second one in December 2019, you’re still up more than 142%!
Just imagine the country roads you can drive down in your new Tesla with those gains! (Or the bourbons you could buy your favorite editor on your trip.)
Roku is a long-term play in the streaming market, so Great Stuff recommends you hold your position for now. As for newcomers? The stock’s price is a bit heady at the moment, but a pullback to the $250 to $300 range could offer an entry point if you’re jonesing to own ROKU.
But if ROKU’s too rich for your streaming diet right now, you might be better off banking on the buffer-fighting tech that makes streaming possible.
Oh yeah, loads of 5G. It’s potentially a $12 trillion market with hyperconnectivity out the wazoo!
What’s more, a single piece of tech holds the key to unlocking 5G — a device that links the fiber optics beneath your feet to wireless 5G networks.
Everyone will eventually rely on this tech, and one company has the goods to make it a reality … bringing 5G to more than a hundred million households across America (and the Rokus that bind them, mind you).
Uber Technologies (NYSE: UBER) continued to sell off its future prospects today, handing off its air taxi unit to competitor Joby Aviation for $75 million.
With its autonomous unit sold to Aurora Innovation last month, we’re left with boring old ride-hailing, food-delivering Uber. I’ll go watch paint dry now, thanks. (Any Red Wanting Blue fans catch the reference? Any Red Wanting Blue fans at all?)
What’s the worst thing that can happen to a cybersecurity company? Just ask FireEye (Nasdaq: FEYE). The company said today that it was hacked by a “highly sophisticated state-sponsored adversary.” That’s probably code for “the Russians did it.”
FireEye is working with customers, security partners and the FBI to contain the damage. But no amount of PR can save FEYE. The stock plunged more than 12%. Ooof.
Speculators had fun with GameStop (NYSE: GME) this year. But the company showed its true colors today, reporting a 30% plunge in revenue and missing Wall Street’s third-quarter earnings and sales estimates. I honestly don’t understand GameStop’s appeal. As a lifelong gamer, I don’t shop there. None of my friends shop there.
Any Great Stuff readers want to enlighten me as to why GME isn’t destined for the landfill alongside Atari’s E.T. the Extra-Terrestrial? Drop me a line at GreatStuffToday@BanyanHill.com.
Is Walt Disney’s (NYSE: DIS) story transforming from a blue-chip investment to a growth stock fairytale? Wells Fargo’s Steven Cahall thinks so and upgraded DIS from equal weight to overweight as a result.
“Investors will soon be willing to pay a high multiple (in some cases on revenue or subs) for a global streaming growth story,” says Cahall.
It worked for Netflix and its limited original content, so why not Disney and its plethora of original programming?
There’s a reason why we recommended this Great Stuff Pick in December 2019 to double down on the streaming market…
Now, with Roku’s ad-a-thon hubbub top of mind, we tune into the teeming streams once again. Around here, we keep touting Roku as the end-all be-all of consumer choice — a platform-agnostic way to tune into any streaming service anywhere … well, except HBO Max. Silly AT&T.
But we don’t want to speak for all the Great Ones streaming out there, which brings us to today’s poll. No matter where you stream your ‘Flix … we want to know how you stream it!
Are you all about the plug-and-play Roku action? Does Amazon light your fire (stick)? Maybe you got a smart TV to just hit a single button and make the dang thing work?
Take the poll below and let us know:
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By the way, if you tuned into last week’s poll, thank you, thank you, thank you! We got some brilliant responses — and not just in the poll, either. Join in on the conversation for yourself: Drop us a line at GreatStuffToday@BanyanHill.com.
We asked you last week if you thought Airbnb’s pandemic debut was a brash act of bravery … or a tone-deaf move of buffoonery.
About 38% of you thought it was a bold strategy, Cotton — and I don’t blame you there. The rest of you, an overwhelming 62%, thought it was worth reading the room better. And if you don’t plan on leaving on a jet plane anytime soon, neither might Airbnb.
Either way … it’s not long before Airbnb shares debut and we find out how much hype this train’s a-rollin’ with.
DoorDash is set to break the IPO waters first this week, and it’s already priced in higher than expected. So, even though I agree that Airbnb picked a helluva time to go public … there’s enough hype out there somewhere to give the sucker a bump off the runway.
It’s whether or not the hype continues through the pandemic uncertainty that we’ll see travel flounder or fly.
If you’re into talking heads, everyone’s favorite vocal hype man — Jim Cramer, not David Byrne, sorry — isn’t camping out on the Street overnight to load up on cheap shares.
With a new price range of $56 to $60 per share (compared to $44 to $50 per share before), Cramer already expects a bit of a pop … but also the same tepid market reaction that many of you expect too: “If you can get the stock for $68 or less this week, I’d back up the truck. If you can get it for less than $85, I’m granting you a small position.”
So generous. Thank you, Cramer.
I’m granting you, on the other hand, a chance to share with us what you think…
Great Stuff: Feedback Granted, Wishes Considered
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We look forward to whatever you decide to write to us today! GreatStuffToday@BanyanHill.com. Don’t forget to put “today” in the address there, otherwise, you’ll end up in the mailer-daemon void again. Womp.
Editor, Great Stuff