IB Net Payout Yields Model

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.
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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. 


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