Head-To-Head Analysis: Roku (NASDAQ:ROKU) & Gaia (NASDAQ:GAIA)

Roku (NASDAQ:ROKU) and Gaia (NASDAQ:GAIA) are both consumer discretionary companies, but which is the better investment? We will contrast the two businesses based on the strength of their earnings, valuation, dividends, profitability, risk, analyst recommendations and institutional ownership.

Institutional and Insider Ownership

86.3% of Roku shares are held by institutional investors. Comparatively, 40.5% of Gaia shares are held by institutional investors. 14.0% of Roku shares are held by company insiders. Comparatively, 28.6% of Gaia shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Risk and Volatility

Roku has a beta of 2.13, meaning that its stock price is 113% more volatile than the S&P 500. Comparatively, Gaia has a beta of 0.83, meaning that its stock price is 17% less volatile than the S&P 500.

Profitability

This table compares Roku and Gaia’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%
Gaia	-5.06%	-5.00%	-3.36%

Valuation & Earnings

This table compares Roku and Gaia”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Roku	$4.39 billion	3.48	-$129.39 million	($0.42)	-247.26
Gaia	$90.36 million	1.60	-$5.23 million	($0.19)	-30.26

Gaia has lower revenue, but higher earnings than Roku. Roku is trading at a lower price-to-earnings ratio than Gaia, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of recent ratings and target prices for Roku and Gaia, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Roku	2	7	17	2	2.68
Gaia	1	0	2	1	2.75

Roku currently has a consensus price target of $101.33, indicating a potential downside of 2.42%. Gaia has a consensus price target of $8.00, indicating a potential upside of 39.13%. Given Gaia’s stronger consensus rating and higher possible upside, analysts plainly believe Gaia is more favorable than Roku.

Summary

Roku beats Gaia on 9 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 Gaia

Gaia, Inc. operates a digital video subscription service and online community for underserved member base in the United States, Canada, Australia, and internationally. The company has a digital content library with various titles in Spanish, German, and French languages available to its subscribers on internet connected devices. Its network includes Yoga channel, which provides access to streaming yoga, Eastern arts, and other movement based classes; Transformation channel that offers content in the areas of spiritual growth, personal development, and expanded consciousness; Alternative Healing channel, which features content focused on food and nutrition, holistic healing, alternative and integrative medicines, and longevity; and Seeking Truth channel that provides access to interviews and presentations in the ancient wisdom and metaphysics genre. The company was formerly known as Gaiam, Inc. and changed its name to Gaia, Inc. in July 2016. Gaia, Inc. was incorporated in 1988 and is headquartered in Louisville, Colorado.