Roku?

I would appreciate if anyone would share their thoughts whether positive or negative on Roku. It does seem to have incredible recent revenue growth and customer retention rates seem good. Main issues seem to be competition and valuation risk?

Hi Jabber. There have been a few large threads on Roku within the last couple months.

There is a way to search specifically for topics on this forum through google. Try using this as a search:

ROKU “Saul’s Investing Discussions” site:fool.com

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It does seem to have incredible recent revenue growth and customer retention rates seem good. Main issues seem to be competition and valuation risk?

Can you put some numbers around those statements and share your outlook?

🆁🅶🅱
I can see by your coat, my friend, you’re from the other side…

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Thank you so much for sharing the search string invain - when I scrolled through the board I saw nothing, but that string brings up the excellent recent discussions!

I am still doing my research on this company but am looking more and more seriously about dipping my toes in :slight_smile:

I have a position in Roku because they went from being the operating system for 1/5 of all smart TVs sold 3 years ago to being in 1/3 of all smart tvs sold recently. I will continue to watch this metric going forward but the odds seem in their favor. Considering I don’t expect any tv makers to adapt apples system nor do I expect any retailers to sell amazon fire os TVs. The metrics are really positive for Roku right now. I bought them after their latest er after trying to understand them for a year. I sold TTD so it seems like a wash but I’m not reading about tearing down walled gardens or how it’s inevitable Roku gives in to TTD.

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I placed this on the NPI slack:

Platform revenue Gross Margin was 68-69% last quarter

If we value the company just on Platform Revenue ($134.2M last quarter, $476 TTM) which yoy grew 79%, then I get a P/S of 21.78 (based on share count of 110.877 million. Compared to other companies in our universe with superior growth rates it seems like this is still not a crazy valuation even with the massive runup.

I assume Smart TVs are a huge TAM, but lots of competition from big boys (google, amazon, apple)
Wish i had looked at ROKU’s platform separately earlier, would of not written it off so quickly.


Roku is a play for the platform revenues. I would ignore hardware, just see it as pass through. If you think Roku can continue gaining platform share then I think this is an easy stock to hold. I dont have that confidence and prefer stocks that have more defined CAP. If they become ubiquitous though then that is their moat.

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