Walmart, Vizio deal would be bad outcome for Roku, says JPMorgan

JPMorgan views the Wall Street Journal’s report that Walmart (WMT) is in talks to buy Vizio (VZIO) for more than $2B credibly and sees the strategic merits of a potential deal for both companies. The report sent Vizio shares trading up 25% and Roku (ROKU) shares trading down 9%, the analyst tells investors in a research note. The firm says Walmart could accelerate Vizio’s SmartCast scale, which currently has 18M active accounts versus Roku’s 76M. A Walmart and Vizio tie-up “would certainly be a bad outcome for Roku,” making Vizio a stronger competitor and resulting in Roku losing its position as the operating system on Walmart’s onn. TVs, contends JPMorgan. The firm says no other bidders for Vizio stand out and that antitrust concerns of the potential deal are unlikely.