Analyst Brent Navon, CFA, from Bank of America Securities, has reaffirmed a Buy rating for Roku, increasing the price target to $115.00. This positive outlook stems from Roku’s robust financial performance and promising growth potential.
In its third-quarter results, Roku exceeded revenue expectations, primarily driven by impressive growth in platform revenue, bolstered by video advertising and the distribution of streaming services. The company’s ability to achieve profitability in operating income and enhance EBITDA margins further contributes to a bullish perspective on its future.
Looking ahead to 2026, several factors are expected to strengthen Roku’s position. These include the acceleration of a new deal with Amazon’s Demand-Side Platform (DSP), an uptick in political advertising contributions, an expansion in ad manager/self-serve capabilities, and ongoing initiatives to grow its subscription business. Additionally, Roku stands to gain from significant industry trends, such as the rising demand for connected TV advertising and streaming video services, along with increased fill rates in its advertising operations. These elements, alongside Roku’s strategic initiatives, serve as a solid foundation for the Buy rating and the enhanced price target.
Navon specializes in the Communication Services sector, covering stocks like Roku, TKO Group Holdings, and Liberty Media’s Formula One division. TipRanks notes that Navon has achieved an average return of 33.8% on his recommendations, boasting a success rate of 90%.
In a related development, Needham has also maintained a Buy rating on Roku, with a price target set at $110. This consensus among analysts signifies confidence in Roku’s growth trajectory as it continues to navigate the evolving landscape of streaming services and advertising.