As of this writing, Roku (NASDAQ:ROKU) is the third-largest holding in Cathie Wood’s ARK Innovation ETF portfolio of stocks. The popular asset manager’s fund holds over 3.2 million shares of the enabler of streaming content. That’s a total value of almost $1.2 billion and makes up 5.4% of the portfolio.
Roku’s stock price is down 25% in the last month as the market has turned sour on so-called stay-at-home stocks that benefited during the pandemic. However, that could be a buying opportunity for long-term investors.
Let’s look at three reasons to buy this Cathie Wood favorite and one reason for caution.