Roku Shares Down 78%! Is It Time To Buy the Dip?

By Kirsteen Mackay

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Roku Inc (NASDAQ: ROKU) shares are now 78% below their 52-week high. Is it a buy-the-dip stock?

Roku Inc (NASDAQ: ROKU) shares are plummeting down over 25% today after disappointing Q4 results. And ROKU stock is down more than 53% year-to-date and 78% below its 52-week high.

Yesterday, the trading volume for ROKU stock was 3x higher than the prior 30-day average. 

While Roku’s Q4 revenues disappointed, the company displays strong financials, data and advertising fundamentals. Its earnings beat analyst estimates but supply chain disruptions combined with revenue miss, streaming hours and ARPU below consensus were enough to spook investors. Plus, Q1 guidance came below Wall Street estimates.

Roku is a pure-play TV streamer equipment company. Its product categories include Roku audio, Roku TVs, and Streaming Players.

Financial Metrics Today

  • Market Cap: $14bn

  • Fully Diluted Shares Outstanding: 142.4m

  • P/BV: 7.2

  • P/E: 71

  • P/S: 8.1

These financial metrics indicate the company is still overvalued at its current share price of $108. Neverthless, analyst consensus has an Overweight rating on the stock with a target share price of $200.92.

ROKU Stock: $210 Price Target from Deutsche Bank Research

Analyst Jeffrey Rand of Deutsche Bank Research downgraded his ROKU stock share price target to $210 (from $300) on 18 February.

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Topics:
Streaming Services
Enter
Industries:
Communication Services
Information Technology
Companies:
Roku

Author: Kirsteen Mackay

This article does not provide any financial advice and is not a recommendation to deal in any securities or product. Investments may fall in value and an investor may lose some or all of their investment. Past performance is not an indicator of future performance.

Kirsteen Mackay does not hold any position in the stock(s) and/or financial instrument(s) mentioned in the above article.

Kirsteen Mackay has not been paid to produce this piece by the company or companies mentioned above.

Digitonic Ltd, the owner of ValueTheMarkets.com, does not hold a position or positions in the stock(s) and/or financial instrument(s) mentioned in the above article.

Digitonic Ltd, the owner of ValueTheMarkets.com, has not been paid for the production of this piece by the company or companies mentioned above.

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