Bank of America Upgrades Roku, Boosting Price Target to $140
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Apr 19 2024
0mins
Should l Buy ROKU?
Source: Benzinga
Roku's stock closed at $107.55, reflecting a 2.68% decline in the latest trading session, which underperformed the S&P 500's daily loss of 0.53%, indicating market caution regarding its future performance.
Bank of America reiterated its buy rating on Roku and raised its price target from $115 to $140, implying a 26% upside from Friday's close, reflecting confidence in the company's future revenue diversification efforts. Analyst Brent Navon noted that Roku's shares have nearly tripled from their 2022 lows, indicating significant efforts in revenue diversification over the past few years, which enhances market expectations for its long-term profitability.
This upgrade could positively influence investor sentiment towards Roku, as the company continues to explore various growth drivers, including self-serve advertising and new pricing initiatives, potentially leading to a recovery in its stock price.
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Analyst Views on ROKU
Wall Street analysts forecast ROKU stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for ROKU is 123.10 USD with a low forecast of 100.00 USD and a high forecast of 145.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
23 Analyst Rating
19 Buy
4 Hold
0 Sell
Strong Buy
Current: 86.050
Low
100.00
Averages
123.10
High
145.00
Current: 86.050
Low
100.00
Averages
123.10
High
145.00
About ROKU
Roku, Inc. operates a television (TV) streaming platform. The Company connects viewers to the streaming content they love, enables content publishers to build and monetize large audiences, and provides advertisers with capabilities to engage consumers. The Company’s segments include platform and devices. The platform segment is engaged in the sale of digital advertising (including direct and programmatic video advertising, media and entertainment promotional spending, and related services) and streaming services distribution (including subscription and transaction revenue shares, the sale of premium subscriptions, and the sale of branded app buttons on remote controls). The devices segment is engaged in the sale of streaming players, Roku-branded TVs, smart home products and services, audio products, and related accessories. The Company sells the majority of its devices in the United States through retailers and distributors as well as through the Company’s website.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Cisco's AI Focus: Cisco anticipates earnings of $1.02 per share and revenue of $15.1 billion for Q2 FY2026, with CEO highlighting a major multi-year campus networking refresh, making AI infrastructure demand a critical growth driver.
- Importance of Employment Report: The January employment report is expected to show an addition of 80,000 nonfarm payrolls and an unchanged unemployment rate of 4.4%, directly impacting private consumption and U.S. GDP, making it crucial for investors to monitor.
- Consumer Price Index Insights: The January CPI is projected to increase by 2.5% year-over-year, with core CPI rising by 2.6%, providing essential inflation details despite not being the Fed's preferred measure, particularly regarding persistent shelter cost inflation.
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Wall Street Analysts Adjust ROKU Ratings
- Analyst Rating Changes: Top Wall Street analysts have adjusted their outlook on ROKU stock, reflecting varying market perceptions that could influence investor decisions and market sentiment.
- Overview of Ratings Update: While specific upgrades or downgrades are not detailed, such changes in analyst ratings typically have a direct impact on stock prices, prompting investors to stay alert for further developments.
- Expected Market Reaction: The adjustments in analyst ratings may lead to short-term volatility in ROKU stock, and investors should consider the significance of these changes in their investment strategies to make informed decisions.
- Source Information: This rating change information is provided by Benzinga, highlighting the critical role analysts play in the market and their potential impact on investor decision-making.
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- Partnership Outlook: The research firm believes that Roku's partnership with Amazon is poised to significantly increase ad spending by 2026, further enhancing the company's revenue growth trajectory.
- Olympics Impact: Google Trends data indicates strong viewership for the Winter Olympics, which Oppenheimer estimates could conservatively contribute 400 basis points to Roku's Q1 Platform revenue, highlighting substantial market potential.
- Revenue Forecast: Oppenheimer projects Roku's core Platform revenue to grow by 17% and 16% in FY26 and FY27 respectively, exceeding previous expectations of 15% and 16%, reflecting the company's robust growth prospects.
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- Competitive Market Advantage: Robinhood's commission-free trading model and expanding service portfolio, including credit cards and high-yield savings accounts, enhance its competitive edge, likely driving long-term performance.
- Roku's Market Leadership: Roku's leadership in the connected TV market is supported by over 90 million households and tens of billions of viewing hours annually, with streaming accounting for 47.5% of total TV viewing time in the U.S., suggesting continued growth in advertising revenue.
- Advertising Tool Innovations: Roku's introduction of a self-serve ads platform and AI-based advertising tools improves efficiency for advertisers, further solidifying its market share and providing strong growth momentum for the next decade.
See More
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- Robinhood Market Performance: Robinhood's stock has more than doubled in the past year, with Q3 revenue reaching $1.27 billion, a 100% year-over-year increase, and net income soaring 271% to $556 million, indicating strong growth momentum that is expected to attract young investors over the next decade.
- Investment Account Growth: The number of investment accounts at Robinhood is steadily improving, and despite a forward P/E ratio of 38.7 suggesting potential volatility, its brand power and expanding service portfolio are likely to support long-term performance.
- Roku's Market Leadership: Roku leads the connected TV market, boasting over 90 million households and supporting tens of billions of viewing hours annually, with streaming accounting for 47.5% of total TV viewing time in the U.S., indicating a strong growth trajectory for advertising revenue.
- Advertising Tool Innovations: Roku has launched new advertising tools, including a self-serve ads platform introduced in 2024, and is implementing AI-based initiatives to facilitate ad creation, enhancing its competitive edge and positioning for robust growth over the next decade.
See More
Key Earnings Reports and Economic Outlook This Week
- DuPont Earnings Expectations: DuPont is expected to report earnings of $0.43 per share and revenue of $1.69 billion for Q4 2025, with analysts noting ongoing pressure in short-cycle businesses, while slight improvements in the automotive sector may influence investor sentiment.
- Cisco's AI Focus: Cisco anticipates earnings of $1.02 per share and revenue of $15.1 billion for Q2 FY2026, with CEO highlighting a major multi-year campus networking refresh, making AI infrastructure demand a critical growth driver.
- Importance of Employment Report: The January employment report is expected to show an addition of 80,000 nonfarm payrolls and an unchanged unemployment rate of 4.4%, directly impacting private consumption and U.S. GDP, making it crucial for investors to monitor.
- Consumer Price Index Insights: The January CPI is projected to increase by 2.5% year-over-year, with core CPI rising by 2.6%, providing essential inflation details despite not being the Fed's preferred measure, particularly regarding persistent shelter cost inflation.
See More
Wall Street Analysts Adjust ROKU Ratings
- Analyst Rating Changes: Top Wall Street analysts have adjusted their outlook on ROKU stock, reflecting varying market perceptions that could influence investor decisions and market sentiment.
- Overview of Ratings Update: While specific upgrades or downgrades are not detailed, such changes in analyst ratings typically have a direct impact on stock prices, prompting investors to stay alert for further developments.
- Expected Market Reaction: The adjustments in analyst ratings may lead to short-term volatility in ROKU stock, and investors should consider the significance of these changes in their investment strategies to make informed decisions.
- Source Information: This rating change information is provided by Benzinga, highlighting the critical role analysts play in the market and their potential impact on investor decision-making.
See More
Oppenheimer Upgrades Roku to Outperform, Citing Multiple Catalysts
- Rating Upgrade: Oppenheimer has upgraded Roku's investment rating from 'perform' to 'outperform', citing multiple catalysts and attractive valuation that are expected to drive stock price appreciation.
- Partnership Outlook: The research firm believes that Roku's partnership with Amazon is poised to significantly increase ad spending by 2026, further enhancing the company's revenue growth trajectory.
- Olympics Impact: Google Trends data indicates strong viewership for the Winter Olympics, which Oppenheimer estimates could conservatively contribute 400 basis points to Roku's Q1 Platform revenue, highlighting substantial market potential.
- Revenue Forecast: Oppenheimer projects Roku's core Platform revenue to grow by 17% and 16% in FY26 and FY27 respectively, exceeding previous expectations of 15% and 16%, reflecting the company's robust growth prospects.
See More
Wall Street's Latest Rating Changes Overview
- Amazon Downgrade: DA Davidson downgraded Amazon from Buy to Neutral, citing concerns that Amazon Web Services (AWS) is losing market share amid competition from Microsoft and Google, indicating a potential need for increased investment to regain its leading position in the cloud computing sector.
- Merit Medical Initiation: BTIG initiated coverage on Merit Medical with a Buy rating, highlighting its comprehensive product portfolio used across various interventional procedures, which underscores the company's high-quality positioning and growth potential in the medical device market.
- JBS Buy Rating: UBS initiated coverage on Brazilian meat company JBS with a Buy rating and a price target of $19.5 per share, implying a 23% upside, reflecting market confidence in its re-rating and potential stock price appreciation.
- Vistra Upgrade: Goldman Sachs upgraded Vistra from Neutral to Buy, projecting a potential EBITDA increase of 3-9% by 2028, indicating investor optimism regarding its future profitability and growth prospects in the nuclear energy sector.
See More
Investment Outlook for Robinhood and Roku
- Robinhood's Growth Momentum: In Q3, Robinhood's revenue doubled year-over-year to $1.27 billion, with net income soaring 271% to $556 million, indicating strong growth potential in the fintech sector and expected to continue attracting young investors over the next decade.
- Competitive Market Advantage: Robinhood's commission-free trading model and expanding service portfolio, including credit cards and high-yield savings accounts, enhance its competitive edge, likely driving long-term performance.
- Roku's Market Leadership: Roku's leadership in the connected TV market is supported by over 90 million households and tens of billions of viewing hours annually, with streaming accounting for 47.5% of total TV viewing time in the U.S., suggesting continued growth in advertising revenue.
- Advertising Tool Innovations: Roku's introduction of a self-serve ads platform and AI-based advertising tools improves efficiency for advertisers, further solidifying its market share and providing strong growth momentum for the next decade.
See More
Predictions for Fintech and Streaming Growth Over the Next Decade
- Robinhood Market Performance: Robinhood's stock has more than doubled in the past year, with Q3 revenue reaching $1.27 billion, a 100% year-over-year increase, and net income soaring 271% to $556 million, indicating strong growth momentum that is expected to attract young investors over the next decade.
- Investment Account Growth: The number of investment accounts at Robinhood is steadily improving, and despite a forward P/E ratio of 38.7 suggesting potential volatility, its brand power and expanding service portfolio are likely to support long-term performance.
- Roku's Market Leadership: Roku leads the connected TV market, boasting over 90 million households and supporting tens of billions of viewing hours annually, with streaming accounting for 47.5% of total TV viewing time in the U.S., indicating a strong growth trajectory for advertising revenue.
- Advertising Tool Innovations: Roku has launched new advertising tools, including a self-serve ads platform introduced in 2024, and is implementing AI-based initiatives to facilitate ad creation, enhancing its competitive edge and positioning for robust growth over the next decade.
See More
