Roku Earnings: Excellent Results Are a Bit Better Than Investors Should Regularly Expect

Roku had a strong third quarter across nearly all operating metrics, and it surprisingly posted positive adjusted EBITDA after five quarters of losses. The firm expects a good fourth quarter as well and reaffirmed its commitment to continue improving EBITDA. While we generally expect these trends to continue, we expect some of the tailwinds that boosted this quarter’s sales to abate. We’re maintaining our $75 fair value estimate, and the stock is close to fairly valued after a 20% rise on the results.