Analyst Steven Cahall of Wells Fargo maintained a Buy rating on Roku (ROKU – Research Report), reducing the price target to $93.00.
Steven Cahall has given his Buy rating due to a combination of factors that suggest potential upside for Roku. Despite macroeconomic pressures, Cahall believes that Roku’s platform growth will outperform expectations, particularly in 2025, as management takes steps to protect EBITDA and free cash flow. The anticipated ad recession is expected to impact pricing, but the company is likely to see improved sell-out on its demand-side platform integrations.
Additionally, Cahall notes that while the device segment faces challenges from tariff impacts, Roku has some flexibility in pricing to mitigate gross profit losses. The company has also demonstrated a strong focus on cost management, with reductions in R&D, sales, and marketing expenses anticipated. With a revised price target of $93, Cahall sees more than 40% upside potential, suggesting that despite the risks, Roku’s underlying growth drivers and improved cost efficiency make it a compelling investment opportunity.
In another report released on April 24, Needham also maintained a Buy rating on the stock with a $88.50 price target.
Based on the recent corporate insider activity of 84 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of ROKU in relation to earlier this year.