Samsung Announcement, Analyst Upgrade Lift Roku Stock

Roku is on track to snap its eight-day losing streak

Managing Editor
Mar 20, 2018 at 10:03 AM
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Roku Inc (NASDAQ:ROKU) stock is higher today, up 3.2% to trade at $34.94, thanks to news the streaming TV company's app would be available on select Samsung Smart TVs this summer. This may have prompted an upgrade at Oppenheimer to "perform" from "underperform." The analyst in coverage said Roku's streaming channel is a positive catalyst, and the cord-cutting trend is only accelerating.

Roku stock has shed 33% in 2018, driven lower by a weak sales outlook last month. Thanks to today's upbeat news, however, the equity is on track to snap an eight-day losing streak. As of last night's close, ROKU had a 14-Day Relative Strength Index (RSI) of 26, firmly in oversold territory, suggesting the stock was due for a short-term bounce coming into today. 

This recent technical weakness has caught the eye of bears. Short interest increased by 56% in the two most recent reporting periods to 9.95 million shares, a record high. Furthermore, this represents a whopping 63% of ROKU's total available float. 

In the options pits, there has been a call-heavy approach lately. This is evidenced by data from the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) that shows the equity with a 10-day call/put volume ratio of 1.11. Meanwhile, the April 60 and 50 calls are home to the two biggest accumulations of open interest.


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