1 Incredible Growth Stock Down 85% You'll Regret Not Buying on the Dip

Core Viewpoint - Roku is showing signs of recovery after a challenging period, with strong operating results and potential for long-term growth as the shift to streaming continues [1][3][16] Company Performance - Roku's share price experienced significant fluctuations, tripling in value from mid-August 2020 to mid-February 2021, but has since dropped about 25% year-to-date and over 85% from its all-time high [2] - The company saw platform revenue grow by 80% in 2021, but growth slowed to 20% in 2022 and shrank by 1% in Q1 2023 due to increased competition and economic pressures [5][6] - In Q2 2023, platform sales increased by 11%, with management expecting 9% year-over-year growth for the third quarter [8] Market Dynamics - The COVID-19 pandemic accelerated the shift to streaming, benefiting Roku as it became the largest connected TV platform [1][4] - Increased competition among streaming services led to higher ad prices, but the subsequent economic downturn and inflation caused a pullback in ad spending, negatively impacting Roku's results [5][6] - Media and entertainment ad spending continues to be a drag on Roku's performance, but there are indications that the worst is behind the company [7] User Engagement - Roku added 2 million net new users in the latest quarter, with average household viewing time increasing from 3.8 hours to 4 hours per day [10] - Roku accounts for 47% of all U.S. streaming time on connected TVs, indicating a strong engaged audience for advertisers [10] Future Outlook - Management anticipates platform revenue to accelerate in Q4 2023 and expects a strong gross margin due to seasonal factors [9] - The long-term investment thesis for Roku remains intact, with expectations that all media will eventually move to streaming, positioning Roku favorably [12][13] - The company is poised to benefit from emerging opportunities in sports streaming as media companies seek to drive viewers to their platforms [15]