In the latest trading session, Roku (ROKU) closed at $104.58, marking a -2.26% move from the previous day. This move lagged the S&P 500's daily gain of 0.41%. Meanwhile, the Dow lost 0.83%, and the Nasdaq, a tech-heavy index, added 0.91%.
The video streaming company's stock has dropped by 3.81% in the past month, falling short of the Consumer Discretionary sector's loss of 3.34% and the S&P 500's gain of 0.38%.
The upcoming earnings release of Roku will be of great interest to investors. On that day, Roku is projected to report earnings of $0.28 per share, which would represent year-over-year growth of 216.67%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $1.35 billion, up 12.62% from the year-ago period.
For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $0.33 per share and a revenue of $4.69 billion, representing changes of +137.08% and 0%, respectively, from the prior year.
Investors might also notice recent changes to analyst estimates for Roku. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the business outlook.
Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. 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.
The Zacks Rank system, which varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has moved 2.21% higher. Roku is currently sporting a Zacks Rank of #2 (Buy).
Digging into valuation, Roku currently has a Forward P/E ratio of 86.68. This valuation marks a premium compared to its industry average Forward P/E of 12.28.
The Broadcast Radio and Television industry is part of the Consumer Discretionary sector. Currently, this industry holds a Zacks Industry Rank of 62, positioning it in the top 26% 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 use Zacks.com to monitor all these stock-influencing metrics, and more, throughout the forthcoming trading sessions.
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Roku, Inc. (ROKU): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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