Oppenheimer Upgraded Roku Shares to “Outperform”

Roku shares were moving higher in Tuesday trading as an analyst from Oppenheimer rated the stock “overweight” and gave it a $50 price target.

Analyst Jason Helfstein of the firm has predicted that there will be 15% upside for shareholders over the next year to a year and a half.

According to Helfstein, the company is primed for a comback due to the company leveraging its role as a leading over-the-top television provider.

The analyst wrote, “The rapid adoption of The Roku Channel gives us incremental confidence in the channel’s ability to garner viewership on other platforms, such as Samsung, allowing Roku to monetize a broader portion of the OTT ecosystem than we had previously assumed was possible,” Helfstein wrote.

Roku should be able to wield “its advantages in pricing and merchandising to remain the market leader in consumer-facing connected television solutions.”

He also wrote, “Roku’s business today is generating users for the Roku platform, either on a Roku Player or the Smart TV Roku OS, and monetizing its partners’ content, either by taking a share of subscription video on demand/advertising video on demand revenue or selling subscription video on demand advertisements itself and sharing the revenue with its partners.”

Disclaimer: We have no position in Roku Inc. (NASDAQ: ROKU) and have not been compensated for this article.