Why ROKU Stock Is Climbing Higher Today

The stock is up close to 8% on Wednesday afternoon

Roku (NASDAQ:ROKU) had a good start to its hump day as a firm upgraded the stock thanks to continued success in the device maker’s streaming practices, as well as strength in its advertising for its streaming platforms.

ROKU Stock
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Guggenheim analyst Michael Morris raised its recommendation of the stock from neutral to buy on Wednesday, with the expectation that the stock will increase by close to 28% over the next year, thanks in part to strength in advertising on its streaming platforms.

“We see continued growth in account and streaming metrics, closing of the video advertising pricing gap with traditional television, demand by third parties for audience development opportunities, and incremental content distribution revenue recognition as key catalysts for shares,” Guggenheim analyst Michael Morris said in a note to investors.

Guggenheim adds that it sees Roku’s first quarter earning results as being “representative of the core trajectory” for the company’s key business lines, per Morris’ notes. “Roku is one of the only pure-play streaming video companies and is uniquely well positioned to benefit from the continued audience shift to digital video consumption,” Morris added.

The business brought in 4 cents in advertising revenue per hour during the three-month period, compared to the 19 cents per hour that traditional TV brings in, per the Guggenheim note. The firm increased its price target on the brand to $119 from $75.

ROKU stock is up about 7.8% on Wednesday following the news.


Article printed from InvestorPlace Media, https://investorplace.com/2019/06/roku-stock/.

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