After months of debate and seemingly endless election days, the presidential campaign is finally over. Of course, due to the emergence of the new coronavirus, this year can be said to be the most unusual year in history. Most importantly, the two presidential candidates are caught in the most controversial election in recent years. Therefore, the long-term impact of the election on the stock market remains uncertain. Many investors have re-examined their investment strategies accordingly. However, despite the uncertainty, streaming stocks will perform well anyway.
This is because, after another tiring election cycle, people will seek some post-election escape. Blockade restrictions have led to a record growth in the number of global streaming media. The habit of watching TV is also evolving. People spend twice as much time watching TV as before. For example, in the second week of March this year, streaming media accounted for 23% of TV viewing time, a sharp increase from 2019. Therefore, a large number of new user registrations have appeared on the OTT media (OTT) platform, which has promoted healthy revenue growth.
So, let's take a look at the three best streaming stocks you can count on in the post-election hustle and bustle.
Netflix (NASDAQ:NFLX)
Amazon (NASDAQ:AMZN)
Roku(NASDAQ:ROKU)
Streaming media stock: One of Netflix’s (NFLX)
subscription streaming services based on Netflix’s pioneering model Streaming media stocks have become a household name. Currently, the industry leader has more than $200 billion in market capital. More importantly, in this global pandemic, Netflix is advancing with the help of the entertainment industry. The six-month return on NFLX stock is currently around 9%.
However, the company's recent third-quarter report does worry some investors. With the relaxation of restrictions, only 2.2 million new users were added to the Netflix platform. The company achieved a revenue target of 6.44 billion U.S. dollars, higher than the expected 6.38 billion U.S. dollars. However, other indicators are also behind expectations, with earnings per share lower than expected by 18%.
Of course, expecting Netflix to reach the numbers reached in the first half of this year is a bit too much. The blockade restrictions were fully effective at that time, creating an ideal consumer base for the company. However, with the recent reappearance of new coronary pneumonia cases, some major countries have closed down one after another, and the number of new registrations may still increase exponentially. In addition, with the rapid approach of winter around the world, streaming media numbers are expected to rise.
Amazon (AMZN)
The online retail giant Amazon has been developing rapidly since the outbreak of the epidemic. At present, the company's annual growth rate exceeds 30% and it has achieved success in all its fields. Of course, we all know Amazon’s retail capabilities, but the company’s streaming services are also worthy of attention. This makes it one of the more attractive streaming stocks.
Specifically, Amazon's Prime subscription service-including various entertainment services, coupons and exclusive products-is growing rapidly. Therefore, one of the main factors driving AMZN's stock price growth in the future will be the company's Prime subscription service. In fact, we have now seen its benefits.
In the third quarter of this year, the revenue of Prime members increased by 33% to US$6.58 billion. According to reports, in January this year, Amazon had 150 million Prime members, and this number will only increase as the epidemic spreads. In addition, the number of Prime videos is also growing, accounting for 23% of subscription video on demand (SVOD) purchases in the second quarter.
In essence, this platform will continue to improve its content, user experience and features to beat competitors. More importantly, the comprehensive package provided by Amazon gives the stock a huge advantage in the market.
Roku (ROKU)
Roku is one of the pioneers of digital media streaming, which allows streaming content in multiple formats. The company has evolved from pure hardware to a powerful software and advertising platform. Therefore, ROKU's stock is one of the best performing stocks in the industry, with a six-month return of 67%. In addition to this, Roku recently announced its third-quarter results, which exceeded the company's highest and lowest expectations. Revenue increased by 73%, reaching $451 million. Gross profit growth 81%, operating income soared to 12 million US dollars, a loss of 26.5 million US dollars in the same period last year. Streaming time increased by 200 million hours to 14.8 billion hours. Finally, average revenue per user increased by 20% year-on-year to $27.
Roko's mission is to connect the entire TV ecosystem and make it easier for content producers to showcase their work worldwide. In addition, it also hopes to become a leader in the advertising industry through the new OneView advertising platform. Obviously, Roku has made waves in the industry and has become one of the most promising streaming stocks in the market.
author: Muslim Farooque, Wall Street Research Society (Public number: meigushe)
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