Zacks Industry Outlook Netflix, Roku and Sirius XM

For Immediate ReleaseChicago, IL – June 25, 2026 – Today, Zacks Equity Research Netflix NFLX, Fox FOXA, Roku Inc. ROKU and Sirius XM SIRIIndustry: Broadcast Radio & TVLink: https://www.zacks.com/commentary/2941955/4-broadcast-radio-tv-stocks-to-watch-from-a-challenging-industryThe Zacks Broadcast Radio and Television industry is grappling with an escalation in cord-cutting despite a surge in demand for streaming content. However, industry players, such as Netflix,Fox, Roku Inc. and Sirius XM, are reaping the benefits of a massive spike in digital content consumption. These companies are thriving due to their diverse content offerings, which include original, regional and short-form content tailored for small screens like smartphones and tablets.Improved Internet speed and penetration, coupled with technological advancements, have been advantageous for industry participants. As monetization and revenues from advertising spending continue to be modest, strategies focused on profit protection, cash management and greater technology integration have gained significance and are expected to aid these companies in driving top-line growth in the near term.Industry DescriptionThe Zacks Broadcast Radio and Television industry encompasses companies that provide entertainment, sports, news, non-fiction and musical content across television, radio and digital media platforms. These entities generate revenues through the sale of television and radio programs, advertising slots and subscriptions.With technological advancements and a growing demand for virtual reality and Internet radio, industry players are increasing their investments in research and development, as well as sales and marketing efforts, to remain competitive. The industry's focus is likely to shift toward sustaining current levels of operations, coupled with a renewed emphasis on flexibility. This approach would accelerate the transition to a variable cost model, thereby reducing fixed costs and enhancing agility in the face of evolving market dynamics.4 Broadcast Radio and Television Industry Trends to WatchShift in Consumer Preference a Key Catalyst: To adapt to the evolving landscape, companies are diversifying their content offerings for over-the-top (OTT) services alongside traditional linear TV. The availability of streaming services across a wide range of platforms has enabled them to reach a global audience, expand their international user base and attract advertisers to their platforms, thereby boosting ad revenues.The utilization of services that aid advertisers in measuring their return on investment and enhancing use cases is expected to benefit industry participants. Major leagues and events, such as the NFL, NHL, Olympics, European Games, EPL and elections, also contribute significantly to ad revenue generation.Increased Digital Viewing Fuels Content Demand: Many industry participants, either launching their own OTT services or acquiring existing ones, leverage user insights to deliver tailored content. The surge in digital viewing has made consumer data readily available, allowing companies to apply artificial intelligence (AI) and machine learning techniques to create or procure targeted content. This approach not only boosts user engagement but also enables industry players to raise the prices of their services at opportune moments without the fear of losing subscribers.Uncertain Macroeconomic Landscape Impedes Production and Ad Demand: Advertising is a significant revenue source for the Broadcast Radio and Television industry. However, industry participants are grappling with the effects of persistently high inflation, rising interest rates, increased capital costs, a soaring U.S. dollar and the looming threat of a recession.These factors have prompted advertisers to trim their ad budgets, which is expected to impact the top-line growth of industry players in the near term. Moreover, intense competition for ad dollars from tech and social media companies has been a significant impediment to the growth of industry participants.Low-Priced Skinny Bundles Impact Revenues: The surge in cord-cutting has compelled industry participants to offer "skinny bundles." These Internet-based services often contain fewer channels than traditional subscriptions and are, therefore, more affordable.This move aligns with changing consumer viewing dynamics, as growth in Internet penetration and advancements in mobile, video and wireless technologies have boosted small-screen viewing. While these alternative services are expected to keep users engaged with their platforms, increasing the need for additional content, the low-priced skinny bundles are likely to dampen the top-line performance of industry players.Zacks Industry Rank Indicates Dull ProspectsThe Zacks Broadcast Radio and Television industry is housed within the broader Zacks Consumer Discretionary sector. It currently carries a Zacks Industry Rank #164, which places it in the bottom 34% of more than 250 Zacks industries.The group’s Zacks Industry Rank, which is the average of the Zacks Rank of all the member stocks, indicates dismal near-term prospects. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than two to one.The industry’s position in the bottom 50% of the Zacks-ranked industries results from a negative earnings outlook for the constituent companies in aggregate. Looking at the aggregate earnings estimate revisions, it appears that analysts are pessimistic about this group’s earnings growth potential. Since June 30, 2025, the industry’s earnings estimates for 2026 have moved south by 6.3%.Despite the gloomy industry outlook, a few stocks are worth watching, as these have the potential to outperform the market based on a strong earnings outlook. But before we present such stocks, it is worth first looking at the industry’s shareholder returns and current valuation.Industry Lags Sector, S&P 500The Zacks Broadcast Radio and Television industry has underperformed the broader Zacks Consumer Discretionary sector and the S&P 500 Index in the past six-month period.The industry has plunged 19.8% over this period compared with the S&P 500’s 7.7% return and the broader sector’s decline of 11.5%, respectively.Industry's Current ValuationOn the basis of trailing 12-month Enterprise Value/ Earnings before Interest Tax Depreciation and Amortization (EV/EBITDA), which is a commonly used multiple for valuing Broadcast Radio and Television stocks, the industry is currently trading at 7.76X versus the S&P 500’s 18.49X and the sector’s 9.2X.In the past five years, the industry has traded as high as 15.56X and as low as 4.92X, recording a median of 8.49X, as the chart below shows.4 Broadcast Radio and Television Stocks to WatchFox Corporation enters the near term with fundamental tailwinds drawn from its announcements. In April, FOX named Amazon Web Services its preferred AI cloud provider, strengthening FOX One's streaming and personalization capabilities. In May, independent studies showed FOX advertising driving up to 81% lift in real-world outcomes, while FOX One launched as a Roku Premium Subscription, widening distribution ahead of the FIFA World Cup 2026.In June, FOX secured a new NFL package in Mexico and agreed to acquire Roku, combining premium live sports and news with a platform reaching over 100 million households, targeting roughly $400 million in run-rate cost synergies. With World Cup rights, broadening digital reach and a strong balance sheet, this Zacks Rank #1 (Strong Buy) company's fundamentals support continued near-term momentum. You can see the complete list of today’s Zacks #1 Rank stocks here.The Zacks Consensus Estimate for fiscal 2026 earnings has moved north by 7.6% to $4.93 per share in the past 60 days. FOXA shares have lost 34% in the past six-month period.Netflixenters the second half of 2026 underpinned by strengthening fundamentals. Management's guidance calls for 2026 revenues of $50.7 billion to $51.7 billion, representing 12% to 14% growth, alongside operating margin expansion to 31.5% from 29.5% in 2025, reflecting genuine profitability gains.Advertising remains a key growth lever: the ad-supported tier now reaches over 250 million global monthly active viewers, with revenues on track to roughly double to about $3 billion, backed by new AI-driven ad tools, expanded programmatic buying, an enlarged NFL live sports slate and planned entry into 15 additional countries from 2027. April's mobile redesign, featuring the new Clips vertical discovery feed, should lift engagement, while June's record performance of KPop Demon Hunters reinforces continued content momentum.The Zacks Consensus Estimate for 2026 earnings has moved north by 2% to $3.60 per share in the past 60 days. Shares of this Zacks Rank #3 (Hold) company have plunged 22.2% in the past six-month period.Roku's near-term fundamentals look encouraging. This Zacks Rank #3 company surpassed 100 million global streaming households in April, underscoring platform scale that drove 28% year-over-year platform revenue growth in the first quarter alongside expanding profitability. Management raised full-year guidance, projecting platform revenue growth near 21% to $5 billion and higher adjusted EBITDA, supported by accelerating advertising demand and record premium subscription sign-ups.New initiatives are reinforcing engagement: Roku Curate simplifies advertiser access to premium inventory, while a redesigned Home Screen introduced in May enhances content discovery across its expanding user base. A fall partnership with The CW Network should further broaden viewership reach. Separately, Roku and Fox Corporation announced a definitive merger agreement in June, adding a distinct near-term catalyst alongside these fundamentals.The Zacks Consensus Estimate for 2026 earnings has moved north by 13.1% to $2.41 per share in the past 60 days. Roku shares have increased 22% in the past six-month period.SiriusXM’s first-quarter results showed free cash flow tripling year over year, churn falling to a record-low 1.5%, and EBITDA margin expanding, prompting management to reaffirm robust full-year guidance of roughly $8.5 billion in revenues, $2.6 billion in adjusted EBITDA, and $1.35 billion in free cash flow.Growth catalysts are building: April's exclusive YouTube audio-advertising partnership extends reach toward 255 million monthly listeners starting this fall, while May's expanded LiveRamp identity-targeting deal with AdsWizz strengthens programmatic monetization. June's video-podcast distribution agreement with Tubi adds 100 million monthly users, leveraging podcasting's strong revenue momentum. With leverage trending toward management's low-to-mid 3x target and continued capital returns, this Zacks Rank #3 company's broadening advertising ecosystem and disciplined execution support a constructive near-term outlook.The Zacks Consensus Estimate for 2026 earnings has remained steady at $3.10 per share in the past 60 days. In the past six-month period, SIRI shares have returned 35.8%.Free: Instant Access to Zacks' Market-Crushing StrategiesSince 2000, our top stock-picking strategies have blown away the S&P's +7.7% average gain per year. Amazingly, they soared with average gains of +48.4%, +50.2% and +56.7% per year.Today you can tap into those powerful strategies – and the high-potential stocks they uncover – free. 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