Roku (ROKU): buy the dip?

2:40 pm ET, 19 Apr 2018

Roku (NASDAQ: ROKU) shares were up by about 3% in today's trading. What do you need to know about Roku and the recent developments around this company?  What is the stock price forecast (prediction)?

Roku provides TV streaming services, while enabling content publishers to monetize large audiences, and providing unique features to advertisers to engage viewers.  It also has a TV which you can buy at Costco or Best Buy.  

Roku's shares recently witnessed a dip when Amazon inked a deal with Best Buy for selling Amazon Fire-powered TVs at Best Buy locations.  Best Buy is now the only retailer that sells those devices.

Currently, there is no information available regarding the pricing of Amazon Fire TVs, their functionality, and features relative to other comparable TVs. So, there is no strong reason to believe that Amazon Fire TVs will be popular. 

Based on broad consumer research, customers show no preference for a single technology when it comes to smart TVs. Instead, they prefer to keep their options around TV and streaming boxes open, so that they are not locked into a single technology. 

In response to the Amazon's move, Roku emphasized the availability of its various TV models among major US retailer.  The company also underlined it’s one of the major OEM partner brands.

Recently, Roku announced ESPN+ channel availability on its platform. This provides users access to many live events, on-demand content and original programming which are unavailable on ESPN’s TV and digital networks.

Can the stock rise further? Per Finstead Research, the stock has the average price target of almost $39. It has an upside of about 22%.

The company has negative valuation ratios, indicating it’s not profitable.  Trading shares of unprofitable companies is a highly speculative activity.

The stock’s high short share of float indicates potential volatility in the upcoming days.


Disclaimer: The news article above expresses the author’s opinion about the topic of the article. We strongly advise you not to base your investment decisions just on this article alone. If you’d like to become a writer for Finny Bites, please send us an email at hi@askfinny.com.

Roku, Inc. (ROKU) Stock Guide

Updated at: 12:15 am ET, 13 Jul 2020

Before we start: if you're looking for ROKU stock price, you can quickly find it out by visiting Finny and typing "ROKU quote". If you're looking for a quick scoop on ROKU stock (chart, price target, market cap, news and buy or sell analysis), go to Finny and look for "ROKU". You'll get all this info in one place. Or you can just type "ROKU news" to get the latest stock news.

Looking to buy or sell Roku, Inc. (ROKU)? Interested in getting the full scoop on ROKU, including earnings and dividends, stock forecast, buy or sell analysis and key stats? If so, you came to the right place.

In this ROKU stock guide, we'll address key questions about ROKU, above and beyond what you can find on Yahoo Finance, Zacks, MarketWatch or Morningstar.

Here is what you'll be able to find in this guide:

Earnings and Dividends: earnings, earnings date, dividend rate and dividend yield;
Analyst Predictions: stock forecast and analyst ratings;
Analysis: Finny Score and buy or sell analysis;
Key Stats: revenue, market cap, revenue growth, profit margin, P/E ratio, P/B ratio, industry, sector, and number of employees.

And here is the list of questions we'll answer:
1. What are ROKU earnings?
2. When is ROKU earnings date?
3. What is ROKU stock forecast (i.e., prediction)?
4. ROKU buy or sell? What is ROKU Finny Score?
5. What are the reasons to buy ROKU? Why should I buy ROKU stock?
6. What are the reasons to sell ROKU? Why should I sell ROKU stock?
7. What are ROKU key stats: revenue, market cap, revenue growth, profit margin, P/E ratio, P/B ratio industry, sector, and number of employees?

So let's start. Scroll down to the question that interests you the most.

Earnings and Dividends

1. What are ROKU earnings?

ROKU trailing 12-month earnings per share (EPS) is -$0.89.

2. When is ROKU earnings date?

ROKU earnings date is August 05, 2020.

Analyst Predictions

3. What is ROKU stock forecast (i.e., prediction)?

Based on ROKU analyst price targets, ROKU stock forecast is $128.28 (for a year from now). That means the average analyst price target for ROKU stock is $128.28. The prediction is based on 6 analyst estimates.

The low price target for ROKU is $60.00, while the high price target is $170.00.

ROKU analyst rating is Hold.

Analysis

4. ROKU buy or sell? What is ROKU Finny Score?

#{finnyScore:22}Our quantitative analysis shows 2 reasons to buy and 7 reasons to sell ROKU, resulting in Finny Score of 22.

5. What are the reasons to buy ROKU? Why should I buy ROKU stock?

Here are the reasons to buy ROKU stock:

  • The company's market share of streaming households is growing. It delivers personalized ads to a TV audience.
  • Average revenue per user is soaring just as total users is soaring. Roku beat revenue and adjusted earnings-per-share estimates.
  • ROKU quarterly revenue growth was 55.20%, higher than the industry and sector average revenue growth (1.38% and 0.94%, respectively). See ROKU revenue growth chart.
  • ROKU cash to debt ratio is 1.23, higher than the average industry (0.10) and sector (0.09) cash to debt ratio. See ROKU cash to debt chart.

6. What are the reasons to sell ROKU? Why should I sell ROKU stock?

Let's look at the reasons to sell ROKU stock (i.e., the bear case):

  • The Over-The-Top (OTT) landscape is changing, and we could see more competition from the large, deep-pocketed tech companies.
  • Roku is a growth company that delivers impressive top-line revenue, but fails to convert it to profit. Revenues and price multiples are on the high end. The high valuation may not be sustainable.
  • ROKU stock price ($153.05) is close to the 52-week high ($153.72). Perhaps now is a good time to sell? See ROKU price chart.
  • ROKU profitability is declining. The YoY profit margin change was -1.66 percentage points. See ROKU profitability chart.
  • ROKU Price/Book ratio is 20.73, which is high compared to its industry peers’ P/B ratios. See ROKU forward Price/Book ratio chart.
  • ROKU Price/Sales ratio is 11.32, which is high compared to its industry peers’ P/S ratios. See ROKU forward Price/Sales ratio chart.
  • ROKU average analyst price target ($128.28) is below its current price ($153.05). See ROKU price target chart.
  • ROKU short share of float is 11.32%. The stock is much more frequently shorted than the average industry, sector or S&P 500 stock. See ROKU short share of float chart.
  • ROKU Enterprise Value/Revenue multiple is 12.16, which is high compared to its industry peers’ Enterprise Value/Revenue multiples. See ROKU Enterprise Value/Revenue chart.

Key Stats

7. What are ROKU key stats : revenue, market cap, revenue growth, profit margin, P/E ratio, P/B ratio industry, sector, and number of employees?

Let's look at the key statistics for ROKU:

Metrics ROKU
Price $165.43
Average Price Target / Upside $128.28 / -22.45%
Average Analyst Rating Hold
Forward Dividend Yield 0.00%
Industry Pay TV
Sector Communication Services
Number of Employees 1,111
Market Cap $14.08B
Forward P/E Ratio -106.97
Price/Book Ratio 11.32
Revenue (TTM) $1.24B
YoY Quarterly Revenue Growth 55.20%
Profit Margin -8.43%

If you liked this analysis, check out Stock Guides for other stocks.

Disclaimer: The news article above expresses the author’s opinion about the topic of the article. We strongly advise you not to base your investment decisions just on this article alone. If you’d like to become a writer for Finny Bites, please send us an email at hi@askfinny.com.

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