$FOX dropped 25% buying $ROKU. Is the market wrong? | Accrued Interest
About this episode
Simeon McMillan argues that Fox's acquisition of Roku is a strategic move despite the market's negative reaction.
Fox's stock is down about 25% since it agreed to buy Roku for $22 billion, and the market has decided the deal is a blunder. Simeon McMillan of Accrued Interest thinks the market is wrong. His case: Roku controls roughly 44% of how Americans reach streaming on the big screen, about 3x the next platform, so Fox just bought the "front door" to streaming and around 100 million connected TVs in North America. Look under the surface and the deal is closer to 16-17x free cash flow once you account for Roku's barely-tapped ad levers and synergies. We get into the homepage that became the new "Netflix homepage," why Fox keeps making the smartest M&A bets in media, the Tubi sleeper Simeon is most bullish on, why he loves Roku but is bearish on Spotify, and why Google and Meta look like "true value stocks" to him. I push back hard on whether Fox plus Roku is really better than Roku staying neutral Switzerland for every bidder. See Simeon's post on Fox / Roku here: https://www.accruedint.com/p/the-strait-of-roku-how-fox-seized This episode is sponsored by my upcoming AI webinar with AlphaSense. The AI landscape has never been more crowded or more confusing…
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