What happened

Shares of Roku (ROKU -0.81%) ended March down a disheartening 23%, according to data provided by S&P Global Market Intelligence. However, as bad as the month was, at one point the stock was down 43% as the COVID-19-induced bear market hit full panic stage. 

Roku's stock did regain ground, but not until a mystery was solved. On March 17, a report surfaced that someone was selling a 6-million-share stake in the company, briefly giving shareholders the jitters.

A couple streams TV content.

Roku enables video-content streaming on TV's. Image source: Getty Images.

So what

The mystery seller turned out to be Fox. The company owned a 5% stake in Roku that it wanted rid of. Now, when someone with that big a stake sells out all at once, it can be a major red flag for other shareholders. After all, who would likely have the inside scoop to Roku's future and viability than a 5% stakeholder?

As it turned out, Fox didn't necessarily sell because it lost faith in Roku. Rather, it needed the cash to acquire Tubi -- a streaming company. That news seems to have completely changed investors' attitude toward Roku's stock. From that moment until the end of March, shares of Roku rallied 30% -- trouncing the S&P 500 index over that brief span.

Now what

In bear markets, it's not uncommon for hot growth stocks like Roku to fall harder than the market averages. So perhaps some aren't surprised to see the stock get crushed in March after its 337% run in 2019. But I think the recent rally buyers have it right. Roku's transformation from a mere hardware manufacturer to an operating system platform turbocharged revenue growth and made it worthy of 2019's market-crushing performance.

News released on the last day of March is a good reminder this growth story still has more unwritten chapters. Roku just announced new features to its operating system to support its growth initiatives, including Spanish voice-command capability. Almost all of the $1.1 billion Roku generated in revenue for 2019 came from the U.S. But in 2020, Roku is giving special emphasis to expand internationally because the video-streaming platform business is a global opportunity.