Roku (ROKU) is a Top-Ranked Momentum Stock: Should You Buy?

Core Insights - Zacks Premium provides various tools to enhance stock market investment confidence and knowledge [1] - The Zacks Style Scores serve as complementary indicators to the Zacks Rank, helping investors select stocks with high potential for market outperformance [3][8] Zacks Style Scores - The Zacks Style Scores categorize stocks into four types: Value Score, Growth Score, Momentum Score, and VGM Score, each rated from A to F based on specific investment characteristics [4][5][6][7] - Value Score focuses on identifying undervalued stocks using financial ratios like P/E and Price/Sales [4] - Growth Score emphasizes a company's financial health and future growth potential based on earnings and sales projections [5] - Momentum Score assesses stocks based on price trends and earnings estimate changes, indicating optimal times for investment [6] - VGM Score combines all three styles to highlight stocks with the best value, growth, and momentum characteristics [7] Zacks Rank - The Zacks Rank is a proprietary model that utilizes earnings estimate revisions to guide investors in stock selection [8] - Stocks rated 1 (Strong Buy) have historically achieved an average annual return of +23.64% since 1988, significantly outperforming the S&P 500 [9] - Investors are encouraged to focus on stocks with a Zacks Rank of 1 or 2 and Style Scores of A or B for optimal investment success [10] Stock Example: Roku - Roku is identified as a leading TV streaming platform in North America, currently holding a Zacks Rank of 3 (Hold) with a VGM Score of B [12] - The stock has a Momentum Style Score of B, with a recent price increase of 3.2% over the past four weeks [12] - Analysts have revised Roku's earnings estimate upwards, with the Zacks Consensus Estimate increasing by $0.29 to $0.12 per share, and the company has an average earnings surprise of +75.4% [13]