Roku: Not A Great Business Model

 

  • Roku continues to slump following a string of disappointing earnings.
  • The video streaming service already has a large customer base limiting future account additions.
  • The stock isn't appealing with struggling growth and profits ahead.
  • Looking for a portfolio of ideas like this one? Members of Out Fox The Street get exclusive access to our model portfolio. Learn More »
While the streaming video sector reports solid growth rates, the business models of the companies involved haven't exactly lived up to grand expectations. Roku (NASDAQ:ROKU) is a primary example of where limited profits are paired with strong revenue growth due to the costs to operate in the industry while streaming revenues are cut from the legacy video funnel. My investment thesis is Bearish on the stock despite the potential tradable setup of a double bottom around $100.

Read the full article on Seeking Alpha. 

Disclosure: No position mentioned. Please review the disclaimer page for more details. 

Comments

Popular posts from this blog

Stat of the Day: Leading Indicators Jump Again

Aurora Cannabis: Deal Or No Deal

Kohl's: Worth $75 Without Financial Engineering