ROKU Jumps On News Netflix Is Exploring Acquisition Opportunities

Roku Inc (NASDAQ: ROKU) shares are trading higher Wednesday following a Business Insider report suggesting the company may be in talks to be acquired by Netflix Inc (NASDAQ: NFLX). According to the report, citing people familiar with the matter, Roku has "abruptly" closed the employee window for trading and talks of a Netflix takeover are bouncing around within the company. The closing of the trading window for employee shares suggests that fundamental changes could be on the horizon. ROKU Stock Analysis and Forecast Roku, Inc. Competition and Comparables In order to undergo a comparable analysis (to determine ROKU stocks value), we need to first outline who ROKU's competitors are. These competitors need to be publicly listed, have valid financial metrics/multiples, operate in a similar manner to ROKU, and have a market cap similar to ROKU (if possible). By keeping this in mind, I found the following list of companies to be some of ROKU stocks closest competitors: SIRI, VIACA, VIAC, LBRDA, LBRDK, FOX, FOXA, WMG, YNDX, TTWO Analysis of Roku, Inc. Stock Performance and Financial Ratios Overall, it seems as though ROKU had a poor financial performance (due to EPS $-0.38) as many of their financial metrics shrunk, most notably their EPS (by $-0.38), as well as their net income (by $-49.99M), and other metrics (as you can tell from the above bullet points). However, ROKU stock missed their EPS estimate by $-0.19--0.18(or 5.56%), as they reported an EPS of $-0.19or the quarter (compared to their estimated EPS of $-0.18). Is ROKU Share Dilution an Issue? As part of their Q1 2022 earnings release, ROKU stated that they currently have 134.71M Shares Outstanding (weighted average), which is up 0 shares (from 134.71M shares outstanding in Q4 2021). This is (INSERT THOUGHTS INTO THE POST). Furthermore, ROKU stock has up to 7.16M of shares that they can issue (thereby diluting ROKU's stock). This maximum dilution for the period would only have a dilutionary effect on ROKU of 5.31%, which is (ENTER THOUGHTS HERE). Latest ROKU Stock Analyst Ratings Here is the current analyst rating distribution for ROKU. In total there are 35 ROKU stock analyst ratings. 22 Buys 6 Holds 7 Sells Analyst Ratings have provided relatively strong indicators of future price movement, which is why they are used to determine if ROKU stock is a buy or sell ROKU Stock Rating and Forecast Currently, we have 3 financial ratings that help investors get a general idea of a company's valuation. These 3 metrics include DCF, ROE, and P/E, which are very common in the investing/valuation climate. Firstly, ROKU stock has a DCF rating of 5 - Very Strong. DCF ratings determine the value behind a company based on their financial projections, expectations, and discount rate (time value of money). This is one of the most used valuation models in the stock market, and thus a high level of importance should be associated with this rating. Secondly, ROKU stock has an ROE rating of 3 - Neutral. ROKU's current ROE is 5.17%, which justifies their rank of 3 - Neutral. ROE shows us how good (or bad) a company is at using their shareholders funds to generate money (returns). ROE is most useful when compared against the industry average, which is currently 3.83%. Lastly, ROKU stock has a P/E rating of 5 - Very Strong, . ROKU stock price to earnings ratio is currently 91.07 which justifies their rank of 5 - Very Strong. Price to Earnings is the most commonly found financial metric and is best used when comparing a company's p/e to the industry average. ROKU operates in the Entertainment industry, which currently has an average P/E of 20.49. Overall, based on the 3 previously mentioned fields, ROKU stock has been given a comprehensive rating of 4 - Strong. This rating implies that they are (Insert Logic) financially. ROKU Stock Price Prediction and Valuation The Latest ROKU Ratings As we know, ROKU stock has been given an overall rating of 4 - Strong. This implies that ROKU is sound fundamentally and is a good candidate for being “undervalued”. With this in mind, let's proceed. ROKU Price Forecast Using Comparable Analysis Price to Book (P/B): ROKU's current P/B ratio is 4.37, compared to the average P/B ratio of ROKU's peers being 0.99. This implies that ROKU is overvalued and their share price should change by a factor of -77.41% to be at fair value (based on ROKU's P/B compared to the P/B of their peers). Price to Equity (P/E): ROKU stock P/E ratio is currently 91.07, compared to the average P/E ratio of ROKU's peers being 20.49. This implies that ROKU is overvalued and their share price should change by a factor of -77.5% to be at fair value (based on ROKU's P/E compared to the P/E of their peers). Overall, ROKU stock is overvalued and needs to experience a change in stock price of (an average of) -77.45% to be considered “at fair value”. ROKU Stocktwits Forum Insights Here are the latest ROKU conversation insights from the ROKU Stocktwits forum in the last 24hrs 201 Posts 187 Likes 463.55k Impressions ROKU forum impressions are useful because it shows you how many people see a ROKU post. This is a great indicator of reach. ROKU Average Daily Message Volume is 201 The ROKU Stocktwits forum is one of the most followed. The average daily message volume for the ROKU community is 201 posts per day. However, when there is a major event (and hype) the message volume usually doubles. The posting volume is decent and allows for fresh content to be consumed by their members constantly. Daily ROKU Stocktwits Impressions are 463.55k Impressions for ROKU Stocktwits are pretty significant and a good measure of how many people are seeing posts discussing Roku, Inc. This is one of the better social momentum and volume indicators. The ROKU Stocktwits community is strong and its posting volume is enough to keep members engaged. Overall, I think this community can get very active when there is hype around their stock, especially when ROKU news is released. The quality of the content being posted is mixed but you can sometimes find decent insights and solid ROKU memes, which are a must for any investor. ROKU Discussion Insights From Twitter Here are the latest ROKU discussion trends from ROKU Twitter in the last 24hrs 742 Tweets 4,107 Likes 5.84M Impressions ROKU discussions are impactful on Twitter due to the reach and typically high level of engagement. To see how many people see a ROKU message board to follow, you just need to search the #ROKU or use the Utradea Social Sentiment Dashboard. Who Are The Main $ROKU Twitter Influencers? ROKU Averages 742 Tweets and 5.84M Impressions in 24 hours ROKU is currently averaging about 742 posts per day and a significant number of impressions, with 5.84M in the last 24hrs. Why is this important? Like it or not, Twitter is one of the best places for breaking information and news, especially on Fintwit, Tracking the latest chatter and spikes in impressions allows you to keep tabs on ROKU on Twitter. This is arguably one of the most important alternative data sources available to date. Number of Influential ROKU Twitter Accounts Here is the latest count of “whale” accounts that are discussing $ROKU. I'll touch on why this is important, but for now, here is a breakdown for the last 72hrs: 87 somewhat large Twitter accounts 10,000+ followers, 19 large Twitter accounts with 100k+ followers 6 very large accounts with 500k+ followers These accounts have been able to draw a lot of attention due to their existing following. Overall, there is a very large amount of mentions (cashtags) for ROKU in the Twitterverse (also known as #fintwit), furthermore, these posts are able to reach a large audience, which helps generate interest, and are generally higher quality when compared to the ROKU Stocktwits posts. Final Thoughts: ROKU Forums and Discussion Boards It's easy to see that Roku, Inc. (ROKU) is active across ROKU Stocktwits, Twitter, Yahoo Finance, and other ROKU message boards. Being able to draw investment insights, such as Roku, Inc. (ROKU) stock forecasts or investor sentiment, is crucial as a Roku, Inc. (ROKU) investor. If you're not keeping track of what's happening for ROKU across social channels, then you're missing out. Check out The Ultimate Guide to Social Media Sentiment Analysis of Stocks to get an edge on the market and with real-time insights from the most popular Roku, Inc. forums and message boards.

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ROKU Jumps On News Netflix Is Exploring Acquisition Opportunities

Jun 8, 2022

bullish

general Analysis

[6 min Read]

blog post cover photo

Photo by: Petter Lagson

Roku Inc (NASDAQ: ROKU) shares are trading higher Wednesday following a Business Insider report suggesting the company may be in talks to be acquired by Netflix Inc (NASDAQ: NFLX).

According to the report, citing people familiar with the matter, Roku has "abruptly" closed the employee window for trading and talks of a Netflix takeover are bouncing around within the company. The closing of the trading window for employee shares suggests that fundamental changes could be on the horizon.


ROKU Stock Analysis and Forecast

Roku, Inc. Competition and Comparables

In order to undergo a comparable analysis (to determine ROKU stocks value), we need to first outline who ROKU's competitors are.

These competitors need to be publicly listed, have valid financial metrics/multiples, operate in a similar manner to ROKU, and have a market cap similar to ROKU (if possible).

By keeping this in mind, I found the following list of companies to be some of ROKU stocks closest competitors:

SIRI, VIACA, VIAC, LBRDA, LBRDK, FOX, FOXA, WMG, YNDX, TTWO


Analysis of Roku, Inc. Stock Performance and Financial Ratios

Overall, it seems as though ROKU had a poor financial performance (due to EPS $-0.38) as many of their financial metrics shrunk, most notably their EPS (by $-0.38), as well as their net income (by $-49.99M), and other metrics (as you can tell from the above bullet points).

However, ROKU stock missed their EPS estimate by $-0.19--0.18(or 5.56%), as they reported an EPS of $-0.19or the quarter (compared to their estimated EPS of $-0.18).

Is ROKU Share Dilution an Issue?

As part of their Q1 2022 earnings release, ROKU stated that they currently have 134.71M Shares Outstanding (weighted average), which is up 0 shares (from 134.71M shares outstanding in Q4 2021). This is (INSERT THOUGHTS INTO THE POST).

Furthermore, ROKU stock has up to 7.16M of shares that they can issue (thereby diluting ROKU's stock). This maximum dilution for the period would only have a dilutionary effect on ROKU of 5.31%, which is (ENTER THOUGHTS HERE).

Latest ROKU Stock Analyst Ratings

Here is the current analyst rating distribution for ROKU. In total there are 35 ROKU stock analyst ratings.

  • 22 Buys
  • 6 Holds
  • 7 Sells

Analyst Ratings have provided relatively strong indicators of future price movement, which is why they are used to determine if ROKU stock is a buy or sell

ROKU Stock Rating and Forecast

Currently, we have 3 financial ratings that help investors get a general idea of a company's valuation. These 3 metrics include DCF, ROE, and P/E, which are very common in the investing/valuation climate.

Firstly, ROKU stock has a DCF rating of 5 - Very Strong. DCF ratings determine the value behind a company based on their financial projections, expectations, and discount rate (time value of money). This is one of the most used valuation models in the stock market, and thus a high level of importance should be associated with this rating.

Secondly, ROKU stock has an ROE rating of 3 - Neutral. ROKU's current ROE is 5.17%, which justifies their rank of 3 - Neutral. ROE shows us how good (or bad) a company is at using their shareholders funds to generate money (returns). ROE is most useful when compared against the industry average, which is currently 3.83%.

Lastly, ROKU stock has a P/E rating of 5 - Very Strong, . ROKU stock price to earnings ratio is currently 91.07 which justifies their rank of 5 - Very Strong. Price to Earnings is the most commonly found financial metric and is best used when comparing a company's p/e to the industry average. ROKU operates in the Entertainment industry, which currently has an average P/E of 20.49.

Overall, based on the 3 previously mentioned fields, ROKU stock has been given a comprehensive rating of 4 - Strong. This rating implies that they are (Insert Logic) financially.

ROKU Stock Price Prediction and Valuation

The Latest ROKU Ratings

As we know, ROKU stock has been given an overall rating of 4 - Strong. This implies that ROKU is sound fundamentally and is a good candidate for being “undervalued”. With this in mind, let's proceed.

ROKU Price Forecast Using Comparable Analysis

  1. Price to Book (P/B): ROKU's current P/B ratio is 4.37, compared to the average P/B ratio of ROKU's peers being 0.99. This implies that ROKU is overvalued and their share price should change by a factor of -77.41% to be at fair value (based on ROKU's P/B compared to the P/B of their peers).
  2. Price to Equity (P/E): ROKU stock P/E ratio is currently 91.07, compared to the average P/E ratio of ROKU's peers being 20.49. This implies that ROKU is overvalued and their share price should change by a factor of -77.5% to be at fair value (based on ROKU's P/E compared to the P/E of their peers).

Overall, ROKU stock is overvalued and needs to experience a change in stock price of (an average of) -77.45% to be considered “at fair value”.

ROKU Stocktwits Forum Insights

Here are the latest ROKU conversation insights from the ROKU Stocktwits forum in the last 24hrs

  • 201 Posts
  • 187 Likes
  • 463.55k Impressions

ROKU forum impressions are useful because it shows you how many people see a ROKU post. This is a great indicator of reach.

ROKU Average Daily Message Volume is 201

The ROKU Stocktwits forum is one of the most followed. The average daily message volume for the ROKU community is 201 posts per day. However, when there is a major event (and hype) the message volume usually doubles. The posting volume is decent and allows for fresh content to be consumed by their members constantly.

Daily ROKU Stocktwits Impressions are 463.55k

Impressions for ROKU Stocktwits are pretty significant and a good measure of how many people are seeing posts discussing Roku, Inc. This is one of the better social momentum and volume indicators.

The ROKU Stocktwits community is strong and its posting volume is enough to keep members engaged. Overall, I think this community can get very active when there is hype around their stock, especially when ROKU news is released. The quality of the content being posted is mixed but you can sometimes find decent insights and solid ROKU memes, which are a must for any investor.

ROKU Discussion Insights From Twitter

Here are the latest ROKU discussion trends from ROKU Twitter in the last 24hrs

  • 742 Tweets
  • 4,107 Likes
  • 5.84M Impressions

ROKU discussions are impactful on Twitter due to the reach and typically high level of engagement. To see how many people see a ROKU message board to follow, you just need to search the #ROKU or use the Utradea Social Sentiment Dashboard.

Who Are The Main $ROKU Twitter Influencers?

ROKU Averages 742 Tweets and 5.84M Impressions in 24 hours

ROKU is currently averaging about 742 posts per day and a significant number of impressions, with 5.84M in the last 24hrs. Why is this important? Like it or not, Twitter is one of the best places for breaking information and news, especially on Fintwit, Tracking the latest chatter and spikes in impressions allows you to keep tabs on ROKU on Twitter. This is arguably one of the most important alternative data sources available to date.

Number of Influential ROKU Twitter Accounts

Here is the latest count of “whale” accounts that are discussing $ROKU. I'll touch on why this is important, but for now, here is a breakdown for the last 72hrs:

  • 87 somewhat large Twitter accounts 10,000+ followers,
  • 19 large Twitter accounts with 100k+ followers
  • 6 very large accounts with 500k+ followers

These accounts have been able to draw a lot of attention due to their existing following.

Overall, there is a very large amount of mentions (cashtags) for ROKU in the Twitterverse (also known as #fintwit), furthermore, these posts are able to reach a large audience, which helps generate interest, and are generally higher quality when compared to the ROKU Stocktwits posts.

Final Thoughts: ROKU Forums and Discussion Boards

It's easy to see that Roku, Inc. (ROKU) is active across ROKU Stocktwits, Twitter, Yahoo Finance, and other ROKU message boards. Being able to draw investment insights, such as Roku, Inc. (ROKU) stock forecasts or investor sentiment, is crucial as a Roku, Inc. (ROKU) investor.

If you're not keeping track of what's happening for ROKU across social channels, then you're missing out. Check out The Ultimate Guide to Social Media Sentiment Analysis of Stocks to get an edge on the market and with real-time insights from the most popular Roku, Inc. forums and message boards.

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ROKU

Roku, Inc.

84.12

0.21
0.25%

Return

-16.57%
Change % Since Posting
-16.70
Change Since Posting
100.83
Price When Posted

Metrics

125.61
Target Price
8/ 10
Confidence
2-6 Months
Timeframe
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News
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SEC
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