Roku Customer Research Reinforces KeyBanc's Bullish Stance

Firsthand checks and analysis of data from 2 million credit and debit cards bodes well for Roku Inc ROKU's outlook, according to KeyBanc Capital Markets. 

The Analyst

Analyst Evan Wingren maintains an Overweight rating on Roku's stock with an unchanged $44 price target.

The Thesis

KeyBanc's database of 2 million credit and debit cards offered insight into approximately 6,000 Roku customers and 20,000 virtual multichannel video programming distributors, and recent momentum remains in place, Wingren said in a research report.

On average, the analyst's data shows indexed MVPD customer growth has generally correlated with Roku's active account growth. During the most recent checks, MVPD data from April and May shows 56-percent year-over-year indexed customer growth, the analyst said.

KeyBanc's assumptions and math imply Roku could notch 45-percent active account growth in the second quarter, which is in-line with the first quarter. 

Search volume trends for "Roku TV" in the U.S. throughout Q2 accelerated from around 28-percent growth in the first quarter to about 31 percent, Wingren said. This closely watched metric is a "good directional indicator" of interest for the the streaming video brand, he said. 

If recent trends are accurate and momentum carries over through June, Roku could show an acceleration in active accounts and issue an earnings report ahead of Wingren's already bullish expectations, the analyst said. 

Price Action

Roku shares were trading up 0.7 percent premarket Monday.

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Photo courtesy of Roku.