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Gabby Jones / Bloomberg
Year
the stock rose on Thursday after the company struck a deal
AT&Tof
HBO Max to its platform. The news has a significantly more bullish Benchmark analyst on the stock.
HBO Max, launched in May, was initially not available on Roku (symbol: ROKU) and
Amazon.com »
s (AMZN) Fire TV platforms. Connected TV platforms, or CTVs, like Roku, allow users to access streaming services in their living room. They are also looking for a cut of advertising or subscriptions on their platform.
Benchmark analyst Daniel Kurnos wrote in a note Thursday that a deal was eventually to come to fruition, but he still sees a huge advantage for Roku stock. He raised his price target from $ 300 to $ 410. It now has the highest target listed by FactSet.
“The two recent deals are more meaningful than the mere inventory they provide, as part of the Bear’s earlier thesis focused on Roku’s trading weight loss over time,” Kurnos wrote.
Kurnos notes that a lot of good news appears to be included in the share price, but he still expects consensus expectations to rise significantly for the company’s fourth quarter. It emphasizes the strength of advertising through improved cost per mile or CPM. CPM is a marketing term used to refer to the price of 1,000 ad impressions on a web page.
It expects the platform’s revenue to reach $ 431.7 million in the fourth quarter, a figure of $ 20 million more than its previous forecast. He thinks it could still prove to be conservative.
“We are now also ahead of the consensus for 2021 on all parameters, effectively reflecting the transfer impact and a slightly more bullish baseline for underlying prices, although the market is trending a bit towards higher levels. standardized, ”he wrote.
Citi Research analyst Jason Bazinet, who has a price target of $ 375 on the stock, wrote in a note Thursday that, in the end, the economics of the deal are less important to Roku than to make one.
“Roku will have plenty of time to revise future agreements with content owners who value Roku’s large CTV platform quite well,” Bazinet wrote. “Right now, creating a truly global platform – with a wide range of content – is much more important, in our opinion.”
Roku’s stock rose 1.1% to $ 329.48 on Thursday. the
S&P 500 Index
increased 0.6%.
Write to Connor Smith at [email protected]
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