From Investing.com: 2024-11-18 09:27:23

Shares of Roku (NASDAQ: ROKU) surged in pre-market trading after Baird Equity Research upgraded the stock to “outperform” from “neutral” with a price target of $90. The shift in advertising dollars to connected TV, Roku’s strong market position, and innovative features like Sports Zones are driving the positive outlook.

Roku’s strategic innovations and strong performance indicators have led to an optimistic outlook from Baird Equity Research. The company’s focus on user engagement, improved monetization, and unique advertising formats are key factors contributing to the upgraded rating.

Roku’s recent initiatives, including video ads on the Home Screen and partnerships with demand-side platforms, are viewed positively by analysts. These moves, along with cost management and investment in The Roku Channel, are expected to drive financial performance and scalability for the company.

The third-quarter performance of Roku showcased positive trends, such as increased brand advertising, growth in streaming hours, and subscription activity during the Olympics. These results highlight the platform’s ability to generate user engagement and revenue, setting a strong foundation for future growth.

Baird Equity Research sees potential for margin growth in Roku, with adjusted EBITDA expected to more than double by 2026. The careful management of operating expenses and strong financial performance indicate an attractive valuation for the stock, aligning with investor expectations post-third-quarter results.



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