Netflix (NFLX) - Get Report has been one of Wall Street's most celebrated growth stories over the past couple of years, but streaming business Roku (ROKU) - Get Report is ahead of Netflix at this point in its life cycle, according to a bullish note from analysts at William Blair.
The firm estimated that Roku will reach 80 million active accounts by 2025. Last quarter, the company reported a 39% year-over-year increase in active users to 30.5 million.
"In our view, Roku will experience similar phased stages of international growth as Netflix did during its international expansion," said analyst Ralph Schackart. "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%."
Those 80 million users will bring in annual revenue of $4.5 billion, 89% of which will be domestic dollars, meaning that Roku still has room to grow overseas.
Roku shares have been hot in 2019, rising 387% year to date. Shares were gaining 2.5% to $146.60 Tuesday.
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