NasdaqGS:ROKU

Stock Analysis Report

Executive Summary

Roku, Inc. operates a TV streaming platform.


Snowflake Analysis

Flawless balance sheet with high growth potential.


Similar Companies

Share Price & News

How has Roku's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: ROKU's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

-2.3%

ROKU

0.8%

US Entertainment

1.2%

US Market


1 Year Return

226.7%

ROKU

22.8%

US Entertainment

24.2%

US Market

Return vs Industry: ROKU exceeded the US Entertainment industry which returned 21.9% over the past year.

Return vs Market: ROKU exceeded the US Market which returned 24.7% over the past year.


Shareholder returns

ROKUIndustryMarket
7 Day-2.3%0.8%1.2%
30 Day-4.8%2.3%3.5%
90 Day1.3%14.3%11.7%
1 Year226.7%226.7%23.6%22.8%26.9%24.2%
3 Yearn/a60.3%55.1%53.0%43.2%
5 Yearn/a103.3%91.0%75.3%56.0%

Price Volatility Vs. Market

How volatile is Roku's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Roku undervalued compared to its fair value and its price relative to the market?

33.01x

Price to Book (PB) ratio


Share Price vs. Fair Value

Below Fair Value: ROKU ($133.42) is trading above our estimate of fair value ($121.94)

Significantly Below Fair Value: ROKU is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: ROKU is unprofitable, so we can't compare its PE Ratio to the Entertainment industry average.

PE vs Market: ROKU is unprofitable, so we can't compare its PE Ratio to the US market.


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate ROKU's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: ROKU is overvalued based on its PB Ratio (33.8x) compared to the US Entertainment industry average (2.5x).


Next Steps

Future Growth

How is Roku forecast to perform in the next 1 to 3 years based on estimates from 16 analysts?

48.4%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: ROKU is forecast to become profitable over the next 3 years, which is considered faster growth than the savings rate (1.7%).

Earnings vs Market: ROKU is forecast to become profitable over the next 3 years, which is considered above average market growth.

High Growth Earnings: ROKU's is expected to become profitable in the next 3 years.

Revenue vs Market: ROKU's revenue (24.1% per year) is forecast to grow faster than the US market (7.5% per year).

High Growth Revenue: ROKU's revenue (24.1% per year) is forecast to grow faster than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: ROKU is forecast to be unprofitable in 3 years.


Next Steps

Past Performance

How has Roku performed over the past 5 years?

20.6%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: ROKU is currently unprofitable.

Growing Profit Margin: ROKU is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: ROKU is unprofitable, but has reduced losses over the past 5 years at a rate of 20.6% per year.

Accelerating Growth: Unable to compare ROKU's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: ROKU is unprofitable, making it difficult to compare its past year earnings growth to the Entertainment industry (8.8%).


Return on Equity

High ROE: ROKU has a negative Return on Equity (-8.07%), as it is currently unprofitable.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Roku's financial position?


Financial Position Analysis

Short Term Liabilities: ROKU's short term assets ($686.9M) exceed its short term liabilities ($277.4M).

Long Term Liabilities: ROKU's short term assets ($686.9M) exceed its long term liabilities ($156.1M).


Debt to Equity History and Analysis

Debt Level: ROKU is debt free.

Reducing Debt: ROKU had no debt 5 years ago.


Balance Sheet

Inventory Level: ROKU has a high level of physical assets or inventory.

Debt Coverage by Assets: ROKU's debt is covered by short term assets (assets are 2.416782852847E+16x debt).


Cash Runway Analysis

For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.

Stable Cash Runway: Whilst unprofitable ROKU has sufficient cash runway for more than 3 years if it maintains its current positive free cash flow level.

Forecast Cash Runway: ROKU is unprofitable but has sufficient cash runway for more than 3 years, due to free cash flow being positive and growing by 37.2% per year.


Next Steps

Dividend

What is Roku's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

companyn/amarketbottom25%1.4%markettop25%3.7%industryaverage1.2%forecastin3Years0%

Current dividend yield vs market & industry

Notable Dividend: Unable to evaluate ROKU's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate ROKU's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if ROKU's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if ROKU's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of ROKU's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

What is the CEO of Roku's salary, the management and board of directors tenure and is there insider trading?

4.9yrs

Average management tenure


CEO

Anthony Wood (53yo)

17.3yrs

Tenure

US$8,336,661

Compensation

Mr. Anthony J. Wood Founded Roku, Inc. in 2002 and serves as its Chairman of the Board and Chief Executive Officer since February 2008 and October 2002 respectively. He serves as President of Roku Inc. sin ...


CEO Compensation Analysis

Compensation vs Market: Anthony's total compensation ($USD8.34M) is about average for companies of similar size in the US market ($USD10.76M).

Compensation vs Earnings: Anthony's compensation has increased whilst the company is unprofitable.


Management Age and Tenure

4.9yrs

Average Tenure

53yo

Average Age

Experienced Management: ROKU's management team is considered experienced (4.9 years average tenure).


Board Age and Tenure

6.9yrs

Average Tenure

55yo

Average Age

Experienced Board: ROKU's board of directors are considered experienced (6.9 years average tenure).


Insider Trading

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

SellUS$68,64519 Mar 19
Ray Rothrock
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares1,111
Max PriceUS$61.79

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 10.9%.


Management Team

  • Steve Kay (58yo)

    Senior VP

    • Tenure: 6.1yrs
    • Compensation: US$3.01m
  • Anthony Wood (53yo)

    Founder

    • Tenure: 17.3yrs
    • Compensation: US$8.34m
  • Matthew Anderson (53yo)

    Chief Marketing Officer

    • Tenure: 6.4yrs
  • James Samford

    Vice President of Investor Relations & Corporate Development

    • Scott Rosenberg (45yo)

      Senior VP & GM of Platform Business

      • Tenure: 1.3yrs
      • Compensation: US$7.43m
    • Mark Goodwin

      Senior Vice President of Enterprise Engineering & Program Management

      • Tenure: 4.1yrs
    • Scott De Haas

      Senior Vice President of Product Engineering and Operations

      • Tenure: 5.3yrs
    • Steve Louden (47yo)

      Chief Financial Officer

      • Tenure: 4.6yrs
      • Compensation: US$4.30m
    • Troy Fenner

      Senior Vice President of Human Resources

      • Tenure: 2yrs
    • Tricia Mifsud

      Vice President of Communications


      Board Members

      • Ray Rothrock (62yo)

        Independent Director

        • Tenure: 5.4yrs
        • Compensation: US$213.16k
      • Neil Hunt (57yo)

        Independent Director

        • Tenure: 2.4yrs
        • Compensation: US$41.00k
      • Alan Henricks (68yo)

        Independent Director

        • Tenure: 7.7yrs
        • Compensation: US$215.76k
      • Anthony Wood (53yo)

        Founder

        • Tenure: 17.3yrs
        • Compensation: US$8.34m
      • Ravi Ahuja (48yo)

        Independent Director

        • Tenure: 6.9yrs
        • Compensation: US$213.76k
      • Jeff Hastings (55yo)

        Director

        • Tenure: 8.4yrs
        • Compensation: US$200.55k
      • Rowenna Fyfield (50yo)

        Independent Director

        • Tenure: 1.7yrs
        • Compensation: US$347.25k

      Company Information

      Roku, Inc.'s company bio, employee growth, exchange listings and data sources


      Key Information

      • Name: Roku, Inc.
      • Ticker: ROKU
      • Exchange: NasdaqGS
      • Founded: 2002
      • Industry: Movies and Entertainment
      • Sector: Media
      • Market Cap: US$15.396b
      • Shares outstanding: 118.09m
      • Website: https://www.roku.com

      Number of Employees


      Location

      • Roku, Inc.
      • 150 Winchester Circle
      • Los Gatos
      • California
      • 95032
      • United States

      Listings

      TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
      ROKUNasdaqGS (Nasdaq Global Select)YesClass A Common StockUSUSDSep 2017
      R35DB (Deutsche Boerse AG)YesClass A Common StockDEEURSep 2017
      0KXILSE (London Stock Exchange)YesClass A Common StockGBUSDSep 2017

      Biography

      Roku, Inc. operates a TV streaming platform. The company operates in two segments, Platform and Player. Its platform allows users to discover and access various movies and TV episodes, as well as live sports, music, news, and others. As of December 31, 2018, the company had 27.1 million active accounts. It also provides advertising products, including videos ads, brand sponsorships, and audience marketplace program; and manufactures, sells, and licenses TVs under the Roku TV name. In addition, the company offers streaming media players and accessories under the Roku brand name; and sells branded channel buttons on remote controls. It provides its products and services through retailers and distributors, as well as directly to customers through its Website in the United States, Canada, the United Kingdom, France, the Republic of Ireland, Mexico, and various Latin American countries. The company was founded in 2002 and is headquartered in Los Gatos, California. 


      Company Analysis and Financial Data Status

      All financial data provided by Standard & Poor's Capital IQ.
      DataLast Updated (UTC time)
      Company Analysis2020/01/21 01:06
      End of Day Share Price2020/01/17 00:00
      Earnings2019/09/30
      Annual Earnings2018/12/31


      Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.