Understanding Roku

I’ve read Beth Kindig’s article on Roku – written before the third quarter results – and the shareholders letter on the Roku site – and also listened to the audio with analysts Q&A. One of the irregular rules of investment, from a book which I bought 50 years ago, is to find smart people, and Beth is one of these. In her article she exhibits a greater knowledge of the company than the analysts on the conference call, so people do not have to look any further for research. I expect that analysts these days ask questions to prove that they were participating.
So now I understand why Roku will not show any significant profits for a while – reminiscent of early Amazon when Bezos stated in interview that the company would show a profit when he said so. I also understand why Martin Sorrell may be better off outside WPP given the scale of likely changes to advertising.
As regards the Roku stock price, there has been some short covering and market makers seem likely to shake the tree because the next quarter is a big one and is also full of variables.
My overall weighting in Roku is not huge, so will buy a few more if there is a dip.

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