On a market cap basis, that won’t be possible. However, Roku knocked on a $50 billion valuation on Friday, as Tesla surged past $800 billion.
Both have become a favorite among bulls. Investors continue to squeeze these names higher.
Roku stock hit an all-time high Thursday and extended those gains on Friday with a sizable rally. The move came on news that Roku is buying Quibi’s content library.
From the November low to today’s high, Roku has a bit more than doubled. Tesla is up 123% from its November low.
Trading Roku Stock
After bottoming in March, Roku enjoyed some very steady gains. The stock would rally, then consolidate for a few months.
Even in the fourth quarter, we saw a series of rallies and consolidations. But once Roku broke out over $250, the stock has been on a massive run.
While the shares corrected to the 10-week moving average, its visit was short-lived before it blew through $360 resistance and the 261.8% extension (measured from the March low to the 2019 high).
With Friday’s rally, the stock is pushing toward the three-times range extension from that measure and the 361.8% extension from the March low to the February high.
Don’t let the extensions bog you down too much. It’s not an exact science -- it just provides a guide.
If the rally can continue, I would look for a push above $413. Above that and the $430 to $450 area is a potential target zone in the short term.
Obviously once this stock has time to base and consolidate, a higher area is possible.
On a dip, I first want to see how $360 holds as support. This was resistance in December and a major breakout point this week.
If Roku holds this level — as well the 21-day moving average — then bulls likely remain in control.
If Roku gets caught up in a marketwide selloff, though, the 10-week and 50-day moving averages are not out of the question, even though the latter is below $300 at this moment.
Remember to stay humble and reasonable after large rallies such as this.