Key Stats for Roku Stock
- Price Change for Roku stock: 1.9%
- $ROKU Share Price as of Dec. 16: $111
- 52-Week High: $117
- $ROKU Stock Price Target: $115
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What Happened?
Roku (ROKU) stock got a major vote of confidence from Morgan Stanley on Tuesday when analyst Thomas Yeh double-upgraded the streaming platform to “Overweight” from “Underweight”. The firm also boosted its price target to $135 from $85, implying roughly 24% upside from Monday’s closing price.
The upgrade reflects growing conviction that Roku can sustain double-digit growth in platform revenue into next year and beyond. The company is currently exiting 2025 with platform revenue growing at roughly 20% when you strip out political advertising and the recent Frndly acquisition.
What’s driving that growth? Yeh pointed to several key catalysts.
- First, Roku is deepening platform partnerships—most notably its recent integration with Amazon’s demand-side platform (DSP), which allows advertisers to tap into Roku’s massive first-party data across its entire platform.
- Second, streaming services continue to raise prices, and when partners benefit from price increases, Roku benefits too, since it monetizes subscriptions on its platform.
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What the Market Is Telling Us About Roku Stock
The double upgrade suggests Morgan Stanley now sees Roku stock as well-positioned to capitalize on the secular shift in TV advertising.
The traditional linear TV ad market is roughly $60 billion and shrinking, while connected TV (CTV) advertising is about $30 billion and growing fast. Eyeballs have already shifted from linear to streaming—ad dollars are just catching up.
Roku’s edge comes from being at the platform level. The company reaches more than 50% of U.S. broadband households, giving it massive scale.
Every user is logged in, which means Roku has first-party data that enables highly performant advertising.
As more inventory flows into CTV and demand shifts toward programmatic buying, Roku is positioned to win share.
Premium subscriptions are another growth driver. Roku stock benefits when streaming partners embed their services deeper into the Roku user interface, creating multiple entry points beyond just an app icon.
The company recently launched this offering in Mexico and plans to expand to additional countries, unlocking international monetization even in markets where ad markets are less mature.
Morgan Stanley’s optimism also stems from tailwinds like political and sports advertising migrating to CTV.
Five years ago, nearly all NFL games were on linear TV. Today, every game is available digitally, and a double-digit percentage is streaming-only. That shift brings ad dollars with it, and Roku stock stands to benefit.
With the company also hitting operating profit in Q3 and guiding for continued margin expansion, Roku stock looks increasingly attractive as it scales toward sustainable free cash flow growth.
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
