The US tech sector's earnings season kicks into high gear this week.
While most of the attention has been focused on the mega-cap names that reported yesterday (Tuesday), including (NASDAQ:), (NASDAQ:), and Google parent (NASDAQ:), the same attention has almost certainly been paid to both Facebook ( NASDAQ:), which reports today (Wednesday) as Amazon (NASDAQ:), which will release the results on Thursday, as both are expected to significantly beat earnings estimates.
That said, there are several other high-growth stocks in the technology sector that will enjoy explosive profits and revenue growth thanks to rising demand for their innovative products.
Here are three names coming up next week that are worth checking out.
1. Roku
Income date: Wednesday 4 August
EPS growth estimate: +134.3% YoY
Estimated Revenue Growth: +73.8% YoY
Performance to date: +38.3%
Market Cap: $60.8 Billion
Roku (NASDAQ:) has seen its stock significantly outperform the broader market this year as the fast-growing streaming video platform continues to capitalize on broad strength in its core ad revenue business.
ROKU shares – which are up 38.3% in the past 12 months and 194.5% in the past 12 months – hit a new all-time high of $490.42 on Tuesday, before closing session at $ 459.37. At its current level, the San Jose, California-based streaming video pioneer has a market cap of $60.8 billion.
Roku, which reported surprising earnings and better-than-expected earnings when it released first-quarter financial results in early May, is expected to report second-quarter results after the US market closes on Wednesday, August 4.
]
The high-flying streaming media platform provider has rivaled or beat Wall Street estimates for 15 consecutive quarters, thanks to rapid user growth, which has translated into higher ad revenue.
Consensus expectations call for second-quarter earnings per share (EPS) of $0.12, significantly better than a loss per share of $0.35 in the same period a year ago. Revenue is expected to grow 74% year-over-year to $618.8 million, driven by strong advertising growth and the expansion of content distribution partnerships.
As such, investors will focus on the company's thriving platform business – including advertising – to see if it can sustain its scorching pace of growth. Roku's platform sales rose 101% in the first quarter to a record $466.5 million.
Merchants will also be paying close attention to Roku's update regarding its active user accounts and average revenue per user (ARPU) – two key metrics for the streaming company. Roku's active accounts were up 35% year-over-year from the first quarter to 53.6 million, while the ARPU came in with a double-digit gain and rose 32% year-over-year to a record high of $32.14 .
Looking ahead, market players will focus on comments from Roku's management regarding the outlook for the current quarter and beyond, as the current work environment has created a perfect backdrop for the streaming media platform to thrive. 2. Wolkflare
Income date: Thursday 5 August
EPS growth estimate: ~0.0% yoy
Estimated Revenue Growth: +46.5% YoY
Performance to date: +51.9%
Market Capitalization: $36.2 billion
Cloudflare (NYSE:), which provides web security and infrastructure services, is one of the best performing names in the fast-growing cloud and edge computing industry.
The content delivery network and web security company, which has seen a 51.9% increase to date in the past 12 months and 209% in the past 12 months, has benefited from increasing demand for its cloud-based network and cybersecurity services.
]
NET shares, which hit a record high of $117.40 on July 23, ended last night at $115.47, giving the San Francisco, California-based provider of cloud-based network and cybersecurity services a valuation of $36.2. billion. ]
Cloudflare shattered sales records for the and provided cheery guidance. Second quarter financial results are expected to be released on Thursday, August 5 after the close.
Consensus estimates prompt the cloud networking and security solutions provider to post a loss of $0.03 per share, unchanged from the same period a year ago. Revenue is expected to grow nearly 47% year-over-year to $146.1 million, driven by strong demand for its web security, content delivery and business network services and solutions.
Besides the top-and-bottom-line numbers, investors will keep an eye on Cloudflare's customer base. The network security company said it had a total of 4.1 million customers at the end of the first quarter, of which nearly 120,000 were paying customers. Even more impressive, large customers spending at least $100,000 annually rose 70% year-over-year to 945 in the first quarter.
Market players will also focus on the cybersecurity technology company's outlook for the rest of the year and beyond. Cloudflare previously forecast a 2021 tax loss per share of $0.10 to $0.11 on revenue of $612 million to $616 million.
3. DraftKings
Income date: Friday 6 August
EPS growth estimate: +3.6% yoy
Estimated revenue growth: +220.5% yoy
Performance to date: +4.7%
Market capitalization: $19.7 billion
DraftKings (NASDAQ:) — widely regarded as the leader in the online sports gambling industry — has seen its stock underperform the broader market this year as Americans returned to land-based casinos in greater numbers as the economy reopened .
Shares of the Boston, Massachusetts-based sportsbook operator, which went public through a Special Purpose Acquisition Company (SPAC) last April, are up less than 5% so far this year, compared to the 17.2% gain over the same time frame.
DKNG shares settled at $48.77 yesterday, more than 34% below the all-time high of $74.32 on March 22. At its current level, DraftKings has a valuation of $19.7 billion, making it the most valuable company in sports betting.
The company, which reported a smaller-than-expected loss and boomed when it announced its first quarter results in early May, is expected to report its next profit before the opening bell on Friday, August 6.
Consensus favors a loss of $0.53 per share for the second quarter, better than a loss of $0.55 per share in the same period a year ago. Revenue is expected to rise 220.5% from the same period a year earlier to $240.4 million, as Americans flocked to the sports betting platform after more states legalized online sports gambling.
As such, investors will focus on DraftKing's average monthly unique paying customers to get a better indication of how well DraftKing's core businesses were performing. The key metric rose 108% year-over-year to 1.5 million in the first quarter, while average revenue per monthly single payer rose 49% to $61.
Market participants will also examine DraftKing's update on its outlook for the remainder of 2021 as the sports betting company is poised to continue to meet its key priorities, which include entering new states, acquiring and retaining customers and invest in product and technology to create new offerings.
