Roku (NASDAQ:ROKU) stock climbed 3% in early trading after the company reached a partnership deal with Walmart (NYSE:WMT). Under the companies’ agreement, Walmart will exclusively sell “featured” products to users of Roku’s TV streaming operating system. With Roku’s e-commerce ads, the operating system’s users will be able to buy Walmart’s products directly from their TVs. And then Walmart will send the products straight to consumers’ homes.
“We’re working to connect with customers where they are already spending time, shortening the distance from discovery and inspiration to purchase,” explained William White, Walmart’s chief marketing office. “By working with Roku, we’re the first to market retailer to bring customers a new shoppable experience and seamless checkout on the largest screen in their homes – their TV,” added White.
An Analyst Is Upbeat on ROKU Stock
In a note to investors today, Matthew Thornton, an analyst at Truist, wrote that Roku would benefit from its partnership with Walmart. Specifically, Thornton believes that Roku will get a lift from strong sales of its e-commerce ads and may decide to sell them to other firms. Possible clients might include “retailers, services, and travel” companies. The platform could result in marketers becoming more interested in advertising on Roku, added Thornton, who kept a $150 price target and a “buy” rating on ROKU stock.
Rumors of a Potential Takeover of Roku
In recent days, there has been speculation that Netflix (NASDAQ:NFLX) will look to acquire Roku. The latter company recently decided to prevent its employees from trading ROKU stock, and, according to reports, there has been talk within Roku’s workforce about an acquisition of the firm by Netflix.
Multiple analysts have been skeptical about the prospects of such a deal. But, according to Seeking Alpha, which cited another website called The Information, Netflix and Roku have been discussing the possibility of collaborating on ads.
On the date of publication, Larry Ramer 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.
