Shares In Telstra Streaming Partner Rocket, Netflix Buy Tipped

Telstra, streaming gear partner Roku, is believed to be close to cutting a deal with Netflix.

Just before the US market took off for a Memorial Day weekend the stock took off in New York when the rumour of a tie up with Netflix hit the market. Roku make the Telstra TV box.

Roku shares rose 7 percent Friday, closing at $38.54, back in September they were trading at $14.

“What a difference six months makes,” Andrew Left of Citron Research said in a recent report on the streaming player maker.

“The move to cutting the cord and [over-the-top] advertising is real and it is a mega-trend that Citron not only does not want to be short, but at this valuation I want to be long,” he added.

Left criticized the stock in late November when the stock was trading at $46.63, — up substantially from its September initial public offering price of $14. He predicted the stock would soon tumble to $28 — which it almost did as it hit a low of $30.29 in April.

But now with Roku trading cheaper relative to peers such as Netflix, Left sees a buying opportunity.

And that’s not the only opportunity that Left sees.

Netflix could in fact be a potential buyer, given pre-existing relationships between senior management at both companies and the ad revenue Roku could provide Netflix, Left said.

Roku declined to comment.

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David Richards

David Richards has been writing about technology for more than 30 years. A former Fleet Street journalist, he wrote the Award Winning Series on the Federated Ships Painters + Dockers Union for the Bulletin that led to a Royal Commission. He is also a Logie Winner for Outstanding Contribution To TV Journalism with a story called The Werribee Affair. In 1997, he built the largest Australian technology media company and prior to that the third largest PR company that became the foundation company for Ogilvy PR. Today he writes about technology and the impact on both business and consumers.