Roku May Lack ‘Oxygen’ to ‘Flourish Over Time,’ Says Nathanson

MoffettNathanson is “very optimistic about future industry growth” in ad-supported VOD but sees “too many long-term risks” at Roku to "enthusiastically recommend" the stock, said senior analyst Michael Nathanson Monday. Roku has built a “strong gatekeeper position” among streaming media devices, he said. That’s creating a “near-term opportunity” for Roku to “extract significant value” from over-the-top companies “seeking their shelf space to grow,” he said. “Roku’s current negotiating position is that streaming services need to be on their platform to be relevant.” But some new services like Peacock are shunning Roku, “a small company in a marketplace packed with the world’s largest tech and media players,” he said. They may “not be willing” to grant Roku the “oxygen” it needs to “flourish over time,” he said.