While streaming remains the future of the entertainment industry, it has become difficult to make a go of the business. The hype that surrounded streaming during the pandemic when everyone was locked down at home has subsided. In its place has come a sea of red ink for most streaming companies as market saturation and overspending on content development set in.

Consequently, the stocks of most streaming companies have fallen sharply since peaking in late 2021 just as Covid-19 vaccines became widely available. Over the last few years, streaming services have tried to become profitable by cutting costs, reducing content, cracking down on password sharing, raising subscription prices, and including advertisements. Sadly, none of these efforts have moved share prices very much.

Here are three streaming service stocks to sell in August before they crash and burn. 

Walt Disney Co. (DIS)

Walt Disney Co. (NYSE:DIS) stock is down 4% after the company reported better-than-expected second-quarter financial results and announced that its combined streaming services — Disney+, Hulu and ESPN+ — turned a profit for the first time. So, what gives? A closer look at the Q2 streaming data provided by Disney shows some troubling signs. Most of the combined profit came from Hulu. ESPN+ actually recorded a loss of $19 million during the quarter.

Also troubling was the fact that the number of subscribers to Disney+ grew only 1% to 118.3 million in Q2. Plus, the 4% year-over-year revenue growth recorded in Disney’s entertainment segment which includes the streaming services was due almost entirely to price increases. Add in the fact that operating income for Disney’s U.S. theme parks fell 6% from a year earlier and it wasn’t a very good print from the Mouse House. DIS stock has declined 37% over the past five years making it a streaming service stock to sell.

Paramount Global (PARA)

Okay, Paramount Global (NASDAQ:PARA) has agreed to merge with privately held Skydance Media. Now what? The deal creates an enlarged Hollywood film and television studio. However, there are no guarantees that the merger will fix the problems at Paramount Global, which operates not only the Paramount+ streaming service but also the Paramount Pictures film studio, CBS television network, and specialty TV channels such as Comedy Central and MTV.

The merger with Skydance Media was seen as an act of desperation on the part of Paramount Global, which has struggled with an unprofitable streaming service and a steep decline in its legacy television business. In recent earnings reports, Paramount executives have said that the traditional TV business has eroded faster than its streaming service could turn a profit. Paramount also ousted CEO Bob Bakish earlier this year and announced $500 million in cost cuts, along with the sale of multiple assets.

All the upheaval has led to a 35% decline in PARA stock over the past 12 months. 

Roku (ROKU)

Roku (NASDAQ:ROKU), which makes streaming devices and internet-connected TVs that can stream content is a definite stock to sell. The company’s share price is down 57% over the last five years, including a 40% decline in the past 12 months. The stock is currently trading 90% below the all-time high it reached in 2021 during the depths of the pandemic when the hype surrounding streaming was at a fever pitch.

Dragging ROKU stock lower has been disappointing financial results and the fact that the company, which has been in business since 2002, remains unprofitable. For this year’s second quarter, Roku posted a loss of 24 cents per share, which was better than a loss of 45 cents forecast by analysts. Total revenue of $968 million also topped the $935.29 million expected on Wall Street. However, average revenue per user, a key metric, was flat year over year at $40.68. Roku stock has fallen 10% since it delivered its Q2 print.

On the date of publication, Joel Baglole did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

On the date of publication, the responsible editor did not have (either directly or indirectly) any positions in the securities mentioned in this article.