Key Points
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Roku shares moved higher on Friday afternoon, after Bloomberg reported that the streaming pioneer was exploring a potential sale of the company.
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With Roku growing faster than it has in four years, it seems like the wrong time to cash out.
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It's more bitter than sweet when a high-conviction stock you own is on the bidding block.
You're not supposed to be upset when you see your largest holding trading sharply higher, but that's just where I was on Friday afternoon. Roku (NASDAQ: ROKU) shares popped 20% on the final market day of the week, most of that coming in the last hour and change.
I ran through the usual suspects that would cause this kind of midday jump. It couldn't be fresh financials. Roku is six weeks away from its next quarterly update, and even if that wasn't the case, it wouldn't push out results during the trading day. A major analyst upgrade wasn't going to create much of a fuss for a widely followed company. An activist investor rattling the cage was unlikely. With Roku's ascending fundamentals and market-thumping stock performance over the past year, a proxy battle couldn't be in the cards.
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A marketing or content partnership, like the promising ad deal Roku struck with Amazon last year, can move the stock higher. It just didn't seem likely that it would be that much higher. That left the lone possibility for the spike being Roku's status as a buyout candidate, and, unfortunately, I was right.
A couple and their dog channel surfing from the couch.
Image source: Getty Images.
Thinking outside the box
Bloomberg reported late in Friday's trading day that Roku is exploring the sale of the company. Unnamed sources close to the matter say that discussions have taken place with at least one media company as a potential buyer. Buyout…