Roku stock climbed Wednesday amid speculation Comcast stock could bid for the streaming video platform to counter the merger of AT&T’s WarnerMedia unit and Discovery (DISCA).
Shares in Viacom (VIAC) also rose on speculation Comcast could make a big acquisition. Comcast Chief Executive Brian Roberts discussed the cable TV and media giant’s options in a Wall Street Journal interview.
Acquiring Roku (ROKU) would be a sizable deal for Comcast. Comcast holds a market cap of $264.8 billion while Roku’s market cap is around $53.4 billion, according to FactSet data.
Comcast stock fell 3.7% to close at 55.48 on the stock market today. Roku stock climbed 4.5% to 421.70. Viacom stock advanced 2.7% to 41.84.
Roku Stock: Consolidation Looms In Streaming Video
Los Gatos, Calif.-based Roku has forged ahead as an aggregator of online video content from a wide range of media and internet companies. Roku stock gets most of its revenue selling advertising on its platform, including commercials for ad-supported services such as its own Roku Channel.
Comcast owns NBCUniversal but Walt Disney (DIS) and the new Warner/Discovery will be bigger content players.
AT&T (T) will spin off its WarnerMedia business, which includes the HBO Max streaming platform, and combine it with Discovery’s domestic and international assets. The deal is expected to close in late 2021.
Roku stock has a stock price Relative Strength Rating of 92 out of a best-possible 99. Shares are currently in a cup base.
Further, Comcast stock holds a Relative Strength Rating of only 55 out of 99, according to IBD Stock Checkup. CMCSA stock trades below an entry point of 58.69 from a cup base.
Follow Reinhardt Krause on Twitter @reinhardtk_tech for updates on 5G wireless, artificial intelligence, cybersecurity and cloud computing.
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