Roku Inc. shares are falling in premarket trading Tuesday after RBC analyst Mark Mahaney downgraded the stock to sector perform from outperform. "Given what we view as sustainably robust growth and profitability levels, we believe Roku's YTD outperformance is fully justified," Mahaney wrote, as Roku shares have climbed almost 200% so far this year. Still, he sees the shares as appropriately valued given that they are trading at a multiple of 11 times price to 2019 sales estimates. Mahaney deems the risk-reward balance "less compelling" but said he "would be constructive again on any major stock pullback." The stock has gained 29% over the past three months, as the S&P 500 has increased 3.4%.
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