Roku Has Further To Fall

Roku crashed more than 20% after reporting Q4 earnings that were fine, but included a weak outlook that investors didn't like.
Shares are still up nearly 3x from their IPO price of $14.
Roku's growth is decelerating quickly, and despite the company's insistence that it is a platform that doesn't depend on hardware revenues, it has a very limited ecosystem outside of it.
The competition against Roku is enormous.
Shortages of NAND chips caused logistics headaches that ate into the company's margins this quarter.
Don't kid yourself: Roku (NASDAQ: ROKU), the recent IPO that shot up >200%, has had this correction long coming. It's a classic tale of hype over fundamentals - investors greedily bought into Roku's story of cord-cutting and streaming without really thinking about the valuation implications of sending the stock up over $50. Even at $40, where Roku fell after reporting its fourth quarter and downbeat guidance, the stock is still vulnerable to further corrections.
https://www.servicedonline.com/

ROKU data by YCharts

Little proprietary value in a very competitive market

As I wrote in a prior article, investors are too quick to draw comparisons between Roku and Netflix (NASDAQ: NFLX), and according to them both have the same benefit of the doubt when it comes to cord-cutting trends - when in reality, it's Netflix that has emerged as the big winner. Over the past quarter, the chasm of quality between Roku and Netflix has only gotten wider. Roku has shamelessly made every effort to encourage the Netflix comparison, publishing a "shareholder letter" with every quarterly earnings instead of a press release, a signature of Netflix's Reed Hastings. But while it's easy to see Netflix still around and growing in five years, it's hard to make the same case for Roku.
source : https://seekingalpha.com/article/4150518-roku-fall

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