We have circled each of the last four Q2s in red, including the 2018 Q2 that ROKU is going to report on. As you can see, the company is experiencing very nice growth.
What's driving Roku's growth?
Cord-cutting movement gaining steam -- More and more customers are ditching cable and satellite TV in favor of streaming content directly from the internet.
In fact, Dish Network just announced that over the past year it has lost 192,000 subscribers to its satellite DISH TV service but gained 41,000 subscribers to its Sling TV offering. More on Sling in a minute...
Roku makes a good product -- Roku is lauded for its ease of use -- making "streaming" from various sources like Netflix, Amazon and YouTube as simple, if not more so, than watching cable. In fact, Roku is often mentioned alongside Amazon Fire, Apple TV and Google Chromecast as the best streaming device.
Smart distribution deals with streaming services -- Earlier this year, Sling TV began offering a free Roku Express to new subscribers of its streaming service. This has the combined benefits of increased revenue as Dish purchases the Rokus and gets consumers familiar with the Roku interface and functionality, feeding into the company's product upgrade cycle.
Playing Roku from here
While we don't see the stock as being worthy of a full Opportunity Alert, we will be sending a note out to LikeFolio members later today regarding how we are going to play Roku's earnings report (hint --- tread lightly).