Roku growing at a faster pace than Netflix did at the same point: Analyst

Netflix (NFLX) is one of the street’s most touted growth stories, but another streaming player is growing at a faster rate than Netflix did at a similar stage in the company’s life: Roku (ROKU).

That’s according to William Blair Analyst Ralph Schackart, who in a note to investors said he expects Roku will reach 80 million active accounts by 2025, bringing in annual revenue of $4.5 billion, 89% of which will be domestic dollars.

“Roku’s active account growth is tracking ahead of Netflix at parallel stages,” Schackart said. “Looking at Roku’s most recent nine quarters against those of Netflix in the beginning stages of Phase II, Roku, on average, achieved 9% quarter-over-quarter growth, compared with Netflix’s average of 8%.”

A man passes by a video sign display with the logo for Roku Inc, a Fox-backed video streaming firm, after the company's IPO at the Nasdaq Marketsite in New York, U.S., September 28, 2017. REUTERS/Brendan McDermid

Roku reported second-quarter earnings earlier this month that beat expectations on both the top and bottom line.

The company’s active accounts hit 30.5 million — a net addition of 1.4 million accounts from the previous quarter. Streaming hours on Roku also increased to 9.4 billion hours for the quarter.

Roku’s stock has been on a tear this year — up more than 350% year-to-date. Earlier in Tuesday trading, the stock hit a new 52-week high.

Blair has an outperform rating on Roku with a $145 price target.

Bridgette Webb is a producer at Yahoo Finance. Follow her on Twitter @bridgetteAwebb.

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