Proceed With Caution When Buying These 3 High-Volume Stocks

: ROKU | Roku Inc. Cl A News, Ratings, and Charts

ROKU – The recently released CPI report indicates that inflation is still at uncomfortably high levels. This may lead the Fed to announce another significant interest rate hike this week. Given this backdrop, it may not be wise to invest in high-volume stocks Roku, Inc. (ROKU), Poshmark (POSH), and Vinco Ventures (BBIG), which are fundamentally weak. Read on….

The August consumer price index (CPI) rose 0.1% sequentially and 8.3% over the past year, exceeding economists’ expectations. Prices were driven by increased food, shelter, and medical care services, offsetting a sharp decline in gasoline prices.

Charlie Ripley, the senior investment strategist at Allianz Investment Management, said, “It’s becoming more apparent to market participants that the amount of tightening from the Fed thus far has not been enough to cool the economy and bring down inflation.”

The Federal Reserve is expected to announce further aggressive interest rate hikes to bring inflation down. Fed Chair Jerome Powell reiterated that the central bank is “strongly committed” to fighting inflation. The market has been widely expecting the Fed to announce another 75-basis-point rate increase this week.

The aggressive policy measure by the central bank is expected to keep the stock market under pressure in the upcoming months. Amid this uncertain market backdrop, it may not be wise to avoid high-volume stocks Roku, Inc. (ROKU), Poshmark, Inc. (POSH), and Vinco Ventures, Inc. (BBIG), as they do not possess enough fundamental strength and growth prospects.

Roku, Inc. (ROKU)

ROKU operates a TV streaming platform through two segments: Platform and Player. Its platform enables users to discover and access various streaming content and content publishers to build and monetize large audiences.

ROKU’s streaming players and TV-related audio devices are available through direct retail sales and licensing arrangements with service operators. It has traded at an average volume of 9,847,838.

For the fiscal second quarter that ended June 30, 2022, ROKU’s operating loss came in at $110.51 million compared to an operating income of $69.08 million. The company’s net loss came in at $112.32 million, compared to a net income of $73.47 million in the year-ago period.

Also, its loss per share came in at $0.82, compared to an EPS of $0.52 in the year-ago period. In addition, its adjusted EBITDA loss came in at $12.07 million, compared to an adjusted EBITDA of $122.43 million in the year-ago period.

Analysts expect ROKU’s EPS for fiscal 2022 to be negative. The stock has lost 77.9% over the past year to close the last trading session at $71.35.

ROKU’s poor prospects are also apparent in its POWR Ratings. It has an overall F rating, equating to a Strong Sell in our proprietary rating system. The POWR Ratings are calculated by considering 118 different factors, with each factor weighted to an optimal degree.

It has an F grade for Growth and Sentiment and a D for Value and Stability. Within the Consumer Goods industry, it is ranked #56 out of 59 stocks. To see the other ratings of ROKU for Momentum and Quality, click here.

Poshmark, Inc. (POSH)

Headquartered in Redwood City, California, POSH is a social marketplace that combines the human connection of a physical shopping experience with the scale, reach, ease, and selection benefits of e-commerce.

The company curates its marketplace into lifestyle categories, including apparel, accessories, footwear, home, beauty, and pets. It has traded at an average volume of 1,141,587.

POSH’s adjusted EBITDA loss for its fiscal second quarter, ended June 30, 2022, came in at $9.82 million, versus a $6.54 million adjusted EBITDA in the year-ago period. The company’s non-GAAP loss from operations stood at $10.80 million, compared to an operating income of $5.70 million in the year-ago period. Also, its net loss widened 797.9% year-over-year to $22.88 million.

Street expects POSH’s EPS to remain negative for fiscal 2022. It has failed to surpass the EPS estimates in three of the trailing four quarters. Over the past year, the stock has declined 45.9% to close the last trading session at $13.86.

POSH’s POWR Ratings reflect this bleak outlook. It has an overall rating of D, equating to a Sell in our proprietary rating system.

It has an F grade for Growth and Sentiment and a D for Value and Stability. Within the Consumer Goods industry, it is ranked #53. Click here to see the other ratings of POSH for Momentum and Quality.

Vinco Ventures, Inc. (BBIG)

BBIG develops and commercializes end-to-end consumer products such as kitchenware, small appliances, toys, pet care, baby products, health and beauty aids, entertainment venue merchandise, and housewares to retailers, mass-market retailers, and e-commerce sites.

BBIG also offers personal protective equipment to governmental agencies, hospitals, and distributors. It has traded at an average volume of 20,983,832.

On August 25, 2022, the company announced that it received a deficiency notice from the Listing Qualifications Department of The Nasdaq Stock Market LLC regarding failure to comply with the requirement to timely file a quarterly report on Form 10-Q for the quarter ended June 30, 2022.

For the fiscal first quarter, ended March 31, 2022, BBIG’s gross profit declined 34.1% year-over-year to $601.16K. Its total selling, general, and administrative costs increased 129.8% year-over-year to $26.80 million. The company’s net loss widened 497% from its year-ago value to $372.94 million.

The stock has declined 81.4% over the past year to close the last trading session at $1.05.

BBIG’s weak fundamentals are reflected in its POWR Ratings. It has an overall F rating, equating to a Strong Sell in our proprietary rating system.

BBIG also has an F grade for Value, Stability, and Quality and a D for Growth, Momentum, and Sentiment. In the Consumer Goods industry, it is ranked last. Get access to all BBIG ratings, here.


ROKU shares were trading at $72.02 per share on Monday afternoon, up $0.67 (+0.94%). Year-to-date, ROKU has declined -68.44%, versus a -17.95% rise in the benchmark S&P 500 index during the same period.


About the Author: Shweta Kumari


Shweta's profound interest in financial research and quantitative analysis led her to pursue a career as an investment analyst. She uses her knowledge to help retail investors make educated investment decisions. More...


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