Roku Inc (NASDAQ:ROKU), one of our top stock picks of 2025, is up 2.4% to trade at $69.75 today, almost 24 hours away from the streaming company's first-quarter earnings report. Ahead of the event, options bears have been growing bolder. Roku has a history of volatile post-earnings moves. The stock gapped higher by 14.1% after an upbeat report in February, and but shed 17.3% after a dismal report in late October. Overall, the stock averaged a post-earnings move, regardless of direction, of 16.5% after the l ...

Core Viewpoint - Roku is expected to report first-quarter 2025 results with total net revenues projected at $1.005 billion, reflecting a 14% year-over-year increase, driven by strong Platform revenue growth of 16% [1][8] Revenue Estimates - The Zacks Consensus Estimate for first-quarter revenues is set at $1 billion, indicating a year-over-year growth of 13.96% [2] - The consensus estimate for Devices revenues is $127 million, while Platform revenues are expected to reach $877 million [13] Earnings Expectations - Roku anticipates a total gross profit of $450 million and adjusted EBITDA of $55 million for the first quarter [1] - The consensus mark for loss is estimated at 20 cents per share, representing a year-over-year growth of 42.86% [2] Earnings Surprise History - In the last reported quarter, Roku achieved an earnings surprise of 45.45%, with an average surprise of 55.07% over the trailing four quarters [5] Factors Influencing Results - Platform growth remains robust, with management estimating a 16% year-over-year increase, supported by streaming services distribution and advertising activities [8] - However, Devices revenues and gross profit were impacted by increased seasonal discounting, leading to excess inventory and slight pressure on gross margins [7][10] Competitive Landscape - Roku faces intensified competition in the advertising space as major players like Netflix, Warner Bros. Discovery, and Disney expand their ad-supported streaming offerings [11] - The absence of political advertising compared to the previous quarter may have also tempered advertising momentum [8] International Expansion - Roku's international growth into markets such as Mexico, Canada, and the United Kingdom is expected to drive user growth, although immediate revenue impact is limited as the focus is on scaling [12] Valuation Metrics - Roku currently trades at a price-to-cash flow ratio of 43.86X, significantly higher than the industry average of 31.54X, indicating high growth expectations but an unattractive valuation for value investors [18] Investment Considerations - While Roku shows strong platform fundamentals and user engagement, caution is advised due to elevated inventory levels, margin pressures, and competitive challenges in the ad-supported streaming market [21][22]

One way to navigate current market volatility is to buy shares of promising companies on dips. Investing while stocks are down can lead to significant long-term returns since every bear market will eventually give way to a bull run that will be even longer, according to the historical record. But which stocks should investors buy in this environment?Let's consider two favorites of Cathie Wood, the founder and CEO of Ark Invest: Block (XYZ 1.01%) and Roku (ROKU 1.69%). The latter is the fifth-largest holding ...

Roku (ROKU) has unveiled new streaming devices and software updates, improving the “Roku Experience” for more than 90 million households. Innovations include personalized content discovery, a new “Coming Soon to Theaters” row, and streamlined sports highlights, making TV more tailored to each viewer.The company also introduced its most compact streaming sticks, upgraded Roku-made TVs, and expanded into smart home tech with battery-powered indoor and outdoor cameras. Roku’s Smart Home OS and new Smart Projec ...

I am a full-time analyst interested in a wide range of stocks. With my unique insights and knowledge, I hope to provide other investors with a contrasting view of my portfolio, given my particular background.If you have any questions, feel free to reach out to me via a direct message on Seeking Alpha or leave a comment on one of my articles.Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the ...

Investors with an interest in Broadcast Radio and Television stocks have likely encountered both Fox (FOXA) and Roku (ROKU) . But which of these two stocks offers value investors a better bang for their buck right now? We'll need to take a closer look.We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great grade in the Value category of our Style Scores system. The proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while ...

Company Performance - Roku's stock closed at $58.46, reflecting a slight increase of +0.1% compared to the previous day, but underperformed against the S&P 500 which gained 0.13% [1] - Over the past month, Roku's shares have declined by 19.05%, significantly worse than the Consumer Discretionary sector's loss of 7.24% and the S&P 500's loss of 6.3% [1] Earnings Forecast - Roku is expected to report an EPS of -$0.27, indicating a 22.86% improvement from the same quarter last year [2] - The Zacks Consensus Estimate projects Roku's revenue to be $1 billion, which is a 13.98% increase from the previous year [2] Annual Estimates - For the annual period, the Zacks Consensus Estimates predict an EPS of -$0.26 and revenue of $4.59 billion, representing increases of +70.79% and +11.52% respectively from the last year [3] - Recent modifications to analyst estimates for Roku indicate a positive outlook, suggesting analyst optimism regarding the company's business and profitability [3] Zacks Rank and Industry Performance - The Zacks Rank system, which evaluates estimate changes, currently ranks Roku at 2 (Buy), with a historical average annual return of +25% for 1 ranked stocks since 1988 [5] - The Broadcast Radio and Television industry, which includes Roku, has a Zacks Industry Rank of 84, placing it in the top 34% of over 250 industries, indicating strong performance potential [6]

Roku Inc. (ROKU) has experienced a challenging start to 2025, with the stock plunging 21.4% year to date (YTD) compared with the Zacks Consumer Discretionary sector’s decline of 9.7%, prompting investors to carefully reassess the company's investment potential. Despite the current market headwinds, the streaming technology company demonstrates strategic resilience and promising growth opportunities that warrant a nuanced approach.Financial Performance and Market PositionThe company's fourth-quarter 2024 ear ...

Roku (ROKU) could be a solid choice for investors given its recent upgrade to a Zacks Rank #1 (Strong Buy). This rating change essentially reflects an upward trend in earnings estimates -- one of the most powerful forces impacting stock prices.The sole determinant of the Zacks rating is a company's changing earnings picture. The Zacks Consensus Estimate -- the consensus of EPS estimates from the sell-side analysts covering the stock -- for the current and following years is tracked by the system.Individual ...

Core Viewpoint - Roku and Warner Bros. Discovery are competing in the ad-supported streaming market, with Roku adopting a platform-first approach focused on CTV advertising, while WBD leverages its content library to enhance its ad-lite streaming tier through Max [1][2]. Roku's Strategy and Performance - Roku's advertising business showed strong growth in Q4 2024, with advertising revenues increasing faster than subscription revenues, excluding political ads which made up 6% of platform revenues. Overall platform revenues rose by 25% year over year [3]. - Viewership on The Roku Channel increased by 82% year over year, significantly expanding its ad-supported reach [3]. - Roku has enhanced its advertising ecosystem through a partnership with Yahoo DSP, improving audience targeting via Roku Data Cloud and Roku Exchange. Innovative ad formats have increased engagement, with Neutrogena's campaign achieving one-third of its reach through home screen promotion [4]. - The launch of Roku Ads Manager in 2024 aims to expand access to CTV advertising for small and medium-sized businesses, positioning Roku to outperform the digital ad market in 2025 [5]. - The Zacks Consensus Estimate for Roku indicates a projected loss of 26 cents per share for 2025, with revenues expected to reach $4.59 billion, reflecting an 11.52% year-over-year growth [6]. Warner Bros. Discovery's Strategy and Performance - Warner Bros. Discovery's ad-supported tier on Max has expanded to over 45 markets in the last 15 months, contributing to its DTC business growth. However, this expansion has resulted in a 6.3% year-over-year decline in Global ARPU in 2024 [8]. - The company is experimenting with different advertising approaches across regions, with sports and news content removed from the ad-lite tier in the U.S. and available across all packages in Latin America [9][10]. - For 2025, WBD's consensus loss estimate is 13 cents per share, with revenues projected at $39.03 billion, indicating a 0.74% year-over-year decline [11]. Stock Performance and Valuation - Year-to-date, Roku shares have decreased by 19.9%, outperforming WBD's 24.1% decline, while both have underperformed the Zacks Broadcast Radio and Television industry's decline of 2.1% [12][14]. - Roku's price-to-cash flow ratio stands at 39.72X, reflecting investor confidence in its growth potential, compared to WBD's 3.66X, indicating more cautious market sentiment [15]. Investment Opportunity - Roku presents a more attractive investment opportunity due to its strong execution in the CTV advertising market, with rising platform revenues and innovative ad products enhancing engagement. Its SMB-focused ad platform and strategic partnerships further bolster monetization potential [18]. - Despite recent share price challenges, Roku's premium valuation suggests confidence in its scalable, ad-driven business model, while WBD faces ARPU pressures and a less established streaming ad strategy [19].