ROKU - Embedded Expectations Analysis - 2019 07 24
Roku Inc. (ROKU:USA) currently trades above corporate averages relative to UAFRS-based (Uniform) Earnings, with a 155.7x Uniform P/E, implying bullish expectations for the firm. However, management has concerns about future growth, upcoming legislation, and the Roku channel.Specifically, management may lack confidence in their ability to meet their gross profit projections and to drive player gross margin growth in 2019. Moreover, they may be overstating the impact of their relationship with media companies, and they may be downplaying concerns about the impact of pending privacy legislation. Additionally, they may be concerned about the sustainability of recent growth in their Roku Channel, and they may be concerned about the loyalty of their customers to the Roku ecosystem.
Roku is engaged in the provision of TV streaming platform for users, content publishers and advertisers. The company collects a variety of information on the Roku platform, including user registration data as well as anonymized information like audience engagement, frequency and content-related use of features, and interactions with advertisements. With its co-branded smart TVs (Roku TVs), the company gives users the ability to opt-in to use automatic content recognition and other technology to collect information about what users watch via antenna and devices connected to Roku TVs, and the company collects data about the use of the Roku TV's home screen and antenna programming guide.
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