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RH (NYSE: RH) and Roku (NASDAQ: ROKU) are highlighted as potentially undervalued stocks despite facing challenges in the current market. RH’s stock has declined by 52% this year, attributed to a weak housing market, while Roku’s stock is currently trading about 32% below its five-year peak.
RH reported trailing-12-month revenue of $3.3 billion, below its peak of $3.9 billion, but saw a 12% year-over-year revenue increase in the latest quarter. Roku achieved 35.8 billion streaming hours in the first quarter, a 16% increase year-over-year, benefiting from a growing digital advertising market.
RH is trading at a price-to-sales multiple of 1.16, significantly lower than its 10-year average of over 2, while Roku’s price-to-sales multiple is at 2.74, the low end of its trading range. Both companies present opportunities for long-term investors to capitalize on their growth potential despite current market volatility.
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