#5 - Roku, Inc. (NASDAQ:ROKU)
Roku, Inc. (NASDAQ: ROKU) - The question investors have to ask with regard to buying Roku stock is what kind of company do you believe it will be for the long haul? That’s because Roku is almost sure to “kill it” this holiday season. Its flagship Roku box is expected to be one of the hot holiday gifts this year and streaming video remains an unsaturated market with industry analysts suggesting that the market may only be 25% of the way towards where it will eventually be. With an account base of 25 million subscribers, there is growth potential because Roku devices allow consumers to use multiple streaming services without an undue reliance on one. That’s the good news. The bad news is that Roku is currently overvalued. It has seen its stock trading at almost half of early October levels. But the real question for investors is when will Roku actually turn an annual profit? The company is forecasting 2020. If that happens, their forward valuation will rise to a level above 300. Although that may come down some as profits grow, it would be hard to sustain that valuation unless the company can significantly raise its long-term growth forecast above the current 20% projection.
About Roku
Roku, Inc, together with its subsidiaries, operates a TV streaming platform in the United states and internationally. The company operates in two segments, Platform and Devices. Its streaming platform allows users to find and access TV shows, movies, news, sports, and others. The Platform segment offers digital advertising, including direct and programmatic video advertising, media and entertainment promotional spending, and related services; and streaming services distribution, such as subscription and transaction revenue shares, and sale of premium subscriptions and branded app buttons on remote controls.
Read More - Current Price
- $80.59
- Consensus Rating
- Moderate Buy
- Ratings Breakdown
- 13 Buy Ratings, 9 Hold Ratings, 2 Sell Ratings.
- Consensus Price Target
- $83.81 (4.0% Upside)
