Roku (ROKU +2.56%) is a well-known streaming service and technology company. Its platform provides streaming content to TVs through its own devices or by licensing its operating system to TV manufacturers. Roku offers a user-friendly operating system that powers its various products.
NASDAQ: ROKU
Key Data Points
Roku products include streaming players (like the Roku Express or Roku Streaming Stick) and Roku TV models manufactured by partner brands. Users can access thousands of free and paid streaming channels or apps, such as Netflix (NFLX -1.29%), Walt Disney's (DIS +1.54%) Disney+, and The Roku Channel (Roku's own ad-supported service) through the platform.
Roku was founded in October 2002 by Anthony Wood, a technology veteran who previously invented the digital video recorder (DVR) at his company ReplayTV. Roku initially focused on building various internet-connected digital media products. Then, in 2007, Netflix hired Wood to lead a project to create a Netflix streaming device.
Netflix eventually decided not to build its own hardware, as management feared backlash from other manufacturers who might otherwise integrate its service. Instead, Netflix spun the project out to Wood's independent company and became an early investor in Roku. Roku then launched its first product in May 2008.
From there, Roku expanded its platform to include thousands of channels from various content providers and developed different device types. Roku went public on Sept. 28, 2017, with its initial public offering (IPO) priced at $14 per share.
If you want to know how to invest in Roku, whether or not you should invest in Roku, whether it's profitable, and more, you've come to the right place.
How to buy Roku stock
Roku stock is publicly traded, so you can buy shares of the business like any other stock. Here are important steps to follow if you want to buy shares of Roku stock.
- Step 1: Open your brokerage account: Log in to your brokerage account where you handle your investments.
- Step 2: Search for the stock: Enter the ticker or company name into the search bar to bring up the stock's trading page.
- Step 3: Decide how many shares to buy: Consider your investment goals and how much of your portfolio you want to allocate to this stock.
- Step 4: Select order type: Choose between a market order to buy at the current price or a limit order to specify the maximum price you're willing to pay.
- Step 5: Submit your order: Confirm the details and submit your buy order.
- Step 6: Review your purchase: Check your portfolio to ensure your order was filled as expected and adjust your investment strategy accordingly.
The bottom line on Roku
Roku is a leader in a growing industry and has recently improved its financial performance with a switch back to profitability, alongside its growing revenue from its core advertising business. For growth investors willing to tolerate a healthy level of risk from fluctuations in advertising spend and the increasingly competitive nature of its industry, Roku could pose a rewarding long-term investment.
However, the entertainment stock is not without risk, and it is best incorporated as part of a well-diversified portfolio.
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