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Roku Inc Class A - Stock Quote ROKU

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Morningstar's Roku Inc Class A Stock Analysis

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Roku Reports Slightly Better-Than-Expected Q1; Weak Top-Line Growth Expected to Continue in Q2

Neil Macker, CFA Senior Equity Analyst

Analyst Note

| Neil Macker, CFA |

Roku posted a slightly better-than-expected start to 2022 with revenue in line and EBITDA ahead of FactSet consensus expectations for the first quarter. Total revenue came in 28% ahead of the same period last year with management guiding for 25% growth in the second quarter. Despite guiding to sub-30% growth in the first half, management reiterated its full-year top-line guidance of 35% growth, which we believe may be too aggressive given the issues in the streaming market, particularly in the United States. We are reducing our fair value estimate to $135 per share from $150 to account for lower revenue expectations.

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Roku Inc Class A's Company Profile

Business Description

Roku is the leading streaming platform in the U.S. by hours watched with under 59 billion hours of content streamed in 2020. The firm’s eponymous operating system is used not only in Roku’s own hardware but in co-branded TVs and soundbars from manufacturers like TCL, Onn, and Hisense. Roku generates revenue from advertising, distribution fees, hardware sales, OS licensing, and subscription sales.

1155 Coleman Avenue
San Jose, CA, 95110
T +1 408 556-9040
Sector Communication Services
Industry Entertainment
Most Recent Earnings Mar 31, 2022
Fiscal Year End Dec 31, 2022
Stock Type Speculative Growth
Employees 3,000