PINS

Pinterest, Inc.

21.47
USD
7.89%
21.47
USD
7.89%
16.14 81.77
52 weeks
52 weeks

Mkt Cap 12.08B

Shares Out 562.70M

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Why Roku Stock Bounced Higher Today

What happened Shares of Roku (NASDAQ: ROKU) were up 5.9% as of 1:49 p.m. ET on Wednesday. The stock was rebounding after a sudden drop the day before when social media company Snap cut its financial guidance for the second quarter. Both Roku and Snap make the bulk of their revenue from advertising, so investors took Snap's revised guidance as a red flag about near-term ad spending. The news reverberated across other social media stocks, such as Meta Platforms and Pinterest. So what Economic recessions usually spell a slowdown in advertising spending, which is one reason investors have slammed Roku this year. The stock is currently down 63% year to date, compared to the 27% drop in the Nasdaq Composite index. This could be a good buying opportunity, since the long-term shift toward streaming is here to stay. In better news, Roku announced a partnership to sell onn, its TV models, in Walmart Canada stores. Roku uses its streaming players and its TV models to give consumers affordable access to its platform, which has an abundance of free ad-supported content. However, supply chain disruptions have caused higher prices for TVs that have made it difficult to acquire new users through this channel. In the first quarter, player revenue fell 19% year over year, while platform revenue, which includes advertising on the platform, grew 39% year over year. Now what Management expects revenue to grow approximately 25% year over year in the second quarter, down from 28% in the first quarter. The fact that Roku is still growing total revenue in this environment, although at a slowing rate, speaks to how well the company (and the stock) can perform once the economy is on solid footing again. 10 stocks we like better than Roku When our award-winning analyst team has a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.* They just revealed what they believe are the ten best stocks for investors to buy right now... and Roku wasn't one of them! That's right -- they think these 10 stocks are even better buys. *Stock Advisor returns as of April 27, 2022 Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool's board of directors. John Ballard has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Meta Platforms, Inc., Pinterest, and Roku. The Motley Fool has a disclosure policy. The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. Founded in 1993 in Alexandria, VA., by brothers David and Tom Gardner, The Motley Fool is a multimedia financial-services company dedicated to building the world's greatest investment community. Reaching millions of people each month through its website, books, newspaper column, radio show, television appearances, and subscription newsletter services, The Motley Fool champions shareholder values and advocates tirelessly for the individual investor. The company's name was taken from Shakespeare, whose wise fools both instructed and amused, and could speak the truth to the king -- without getting their heads lopped off.

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