Investors are tuning back into (NASDAQ: ROKU) stock following blowout financial results from rival Netflix. Yes, the two streaming services have different business models, with Netflix enjoying larger economies of scale and a steady stream of subscription revenue. Meanwhile, Roku is dependent on advertising sales and is still working toward profitability.
Roku will update investors on its latest operating results in early November, and the stock's rally in recent weeks suggests that many investors believe they'll see good news in that announcement. So, before the report arrives, let's look at the main reasons to be bearish or bullish about this growth stock.
Bears will begin by pointing out that Roku's stock price is moving in the opposite direction of its earnings power. Operating losses expanded in the first half of 2023, jumping to $300 million from $140 million a year earlier. This slump occurred in concert with sluggish sales trends, too.
Source Fool.com