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

Zacks Equity Research

Roku (ROKU) closed the most recent trading day at $332.02, moving -1.98% from the previous trading session. This move lagged the S&P 500's daily gain of 0.64%. At the same time, the Dow added 0.65%, and the tech-heavy Nasdaq gained 0.14%.

Heading into today, shares of the video streaming company had gained 20.41% over the past month, outpacing the Consumer Discretionary sector's gain of 7.1% and the S&P 500's gain of 3.19% in that time.

Investors will be hoping for strength from ROKU as it approaches its next earnings release. The company is expected to report EPS of -$0.08, up 38.46% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $605.92 million, up 47.34% from the prior-year quarter.

For the full year, our Zacks Consensus Estimates are projecting earnings of -$0.80 per share and revenue of $1.74 billion, which would represent changes of -53.85% and +53.87%, respectively, from the prior year.

It is also important to note the recent changes to analyst estimates for ROKU. 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.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

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. The Zacks Consensus EPS estimate has moved 8.3% higher within the past month. ROKU is currently a Zacks Rank #3 (Hold).

The Broadcast Radio and Television industry is part of the Consumer Discretionary sector. This group has a Zacks Industry Rank of 113, putting it in the top 45% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. 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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