Roku shares stream higher after Guggenheim hits the “buy” button on the stock
Roku is now in nearly half of all US households with broadband.
Roku shares leapt 6% Wednesday afternoon after Guggenheim doubled down on its “buy” rating for the streaming TV company.
Roku is now in more than half of US broadband homes and making big moves in Mexico, where it’s in over 40% of broadband homes. While Roku no longer shares quarterly household streaming numbers, Guggenheim forecasts the tech company will reach 92 million streaming households globally and 65 million in the US by the end of the first quarter.
Roku is seeing growing demand for The Roku Channel, with half of US broadband households kicking off their TV time on its home screen. To keep the momentum going, the company’s expanding third-party partnerships to ramp up advertising demand. It’s starting to work: in Q4, Roku’s platform revenue — which includes advertising, content, and subscription sales — topped $1 billion for the first time.
Despite maintaining the buy rating, Guggenheim lowered its 12-month price target on the stock from $115 to $100 per share, based on “the contraction in the relative peer multiple.” Even still, the $100 target implies a 40% boost from current stock levels. Looking ahead, Guggenheim says Roku is “well-positioned” to reach its 2026 operating profit goal. Roku shares are up nearly 12% over the past year.