Roku (NASDAQ:ROKU – Get Free Report) and iHeartMedia (NASDAQ:IHRT – Get Free Report) are both consumer discretionary companies, but which is the better stock? We will contrast the two businesses based on the strength of their analyst recommendations, valuation, risk, profitability, institutional ownership, earnings and dividends.
Profitability
This table compares Roku and iHeartMedia’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Roku | -1.40% | -2.44% | -1.44% |
| iHeartMedia | -9.68% | -2.84% | -1.74% |
Analyst Recommendations
This is a summary of recent recommendations for Roku and iHeartMedia, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Roku | 1 | 7 | 17 | 2 | 2.74 |
| iHeartMedia | 0 | 4 | 1 | 0 | 2.20 |
Risk & Volatility
Roku has a beta of 2.05, meaning that its stock price is 105% more volatile than the S&P 500. Comparatively, iHeartMedia has a beta of 1.87, meaning that its stock price is 87% more volatile than the S&P 500.
Earnings and Valuation
This table compares Roku and iHeartMedia”s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Roku | $4.39 billion | 3.29 | -$129.39 million | ($0.42) | -233.83 |
| iHeartMedia | $3.85 billion | 0.11 | -$1.01 billion | ($2.43) | -1.11 |
Roku has higher revenue and earnings than iHeartMedia. Roku is trading at a lower price-to-earnings ratio than iHeartMedia, indicating that it is currently the more affordable of the two stocks.
Insider and Institutional Ownership
86.3% of Roku shares are owned by institutional investors. Comparatively, 93.9% of iHeartMedia shares are owned by institutional investors. 14.0% of Roku shares are owned by company insiders. Comparatively, 8.5% of iHeartMedia shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.
Summary
Roku beats iHeartMedia on 12 of the 15 factors compared between the two stocks.
About Roku
Roku, Inc., together with its subsidiaries, operates a TV streaming platform in the United states and internationally. The company operates in two segments, Platform and Devices. Its streaming platform allows users to find and access TV shows, movies, news, sports, and others. The Platform segment offers digital advertising, including direct and programmatic video advertising, media and entertainment promotional spending, and related services; and streaming services distribution, such as subscription and transaction revenue shares, and sale of premium subscriptions and branded app buttons on remote controls. The Devices segment provides sale of streaming players, Roku-branded TVs, smart home products and services, audio products, and related accessories as well as licensing arrangements with service operators. Roku, Inc. was incorporated in 2002 and is headquartered in San Jose, California.
About iHeartMedia
iHeartMedia, Inc. operates as an audio media company in the United States and internationally. It operates through three segments: Multiplatform Group, Digital Audio Group, and Audio & Media Services Group. The Multiplatform Group segment offers broadcast radio stations, sponsorship and events, and live and virtual events; and operates Premiere Networks, a national radio network that produces, distributes, or represents syndicated radio programs and services to radio station affiliates. It also delivers real-time traffic flow and incident information, and weather updates, sports, and news. The Digital Audio Group segment provides podcasting, digital sites, newsletters, digital services, and programs; and iHeartRadio, a mobile app and web based service for radio stations, digital only stations, custom artist stations, and podcasts. The Audio and Media Services Group segment engages in the media representation business; and provides scheduling and broadcast software and services. This segment also provides RCS, a cloud and on-premises broadcast software, such as radio and television automation, music scheduling, newsroom automation, advertising sales management, disaster recovery solutions; and real-time audio recognition technology to radio and television stations, cable channels, record labels, advertisers, and agencies, as well as media streaming and research services. The company was formerly known as CC Media Holdings, Inc. and changed its name to iHeartMedia, Inc. in September 2014. The company is headquartered in San Antonio, Texas.
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