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Roku (ROKU) Gains As Market Dips: What You Should Know

Zacks Equity Research

Roku (ROKU) closed the most recent trading day at $147.24, moving +0.25% from the previous trading session. The stock outpaced the S&P 500's daily loss of 0.08%. Elsewhere, the Dow lost 0.07%, while the tech-heavy Nasdaq lost 0.59%.

Heading into today, shares of the video streaming company had gained 44.34% over the past month, outpacing the Consumer Discretionary sector's gain of 2.73% and the S&P 500's gain of 2.7% in that time.

ROKU will be looking to display strength as it nears its next earnings release, which is expected to be November 6, 2019. On that day, ROKU is projected to report earnings of -$0.28 per share, which would represent a year-over-year decline of 211.11%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $258.07 million, up 48.84% from the year-ago period.

ROKU's full-year Zacks Consensus Estimates are calling for earnings of -$0.50 per share and revenue of $1.08 billion. These results would represent year-over-year changes of -525% and +45.76%, respectively.

Any recent changes to analyst estimates for ROKU should also be noted by investors. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. ROKU is currently a Zacks Rank #1 (Strong Buy).

The Broadcast Radio and Television industry is part of the Consumer Discretionary sector. This industry currently has a Zacks Industry Rank of 153, which puts it in the bottom 40% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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