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Roku (ROKU) Outpaces Stock Market Gains: What You Should Know

Zacks Equity Research

Roku (ROKU) closed at $104.34 in the latest trading session, marking a +1.82% move from the prior day. This move outpaced the S&P 500's daily gain of 0.02%. Elsewhere, the Dow gained 0.1%, while the tech-heavy Nasdaq added 0.17%.

Coming into today, shares of the video streaming company had lost 2.38% in the past month. In that same time, the Consumer Discretionary sector gained 5.47%, while the S&P 500 gained 4.82%.

Investors will be hoping for strength from ROKU as it approaches its next earnings release. Meanwhile, our latest consensus estimate is calling for revenue of $224.75 million, up 43.32% from the prior-year quarter.

ROKU's full-year Zacks Consensus Estimates are calling for earnings of -$0.58 per share and revenue of $1.04 billion. These results would represent year-over-year changes of -625% and +39.72%, respectively.

Any recent changes to analyst estimates for ROKU should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. ROKU is currently sporting a Zacks Rank of #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 172, which puts it in the bottom 33% 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.

To follow ROKU in the coming trading sessions, be sure to utilize Zacks.com.


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