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Roku Inc. (NASDAQ:ROKU) shares gained Tuesday after Guggenheim reiterated its buy rating and $100 price target on the streaming platform company following a new partnership with Amazon (NASDAQ:AMZN). The stock, which has delivered an impressive 52% return over the past year according to InvestingPro data, continues to show strong momentum with analyst targets ranging from $60 to $130.
The companies announced a collaboration that will leverage Roku’s viewer data and connected TV inventory with Amazon’s demand-side advertising platform to enhance the performance of connected TV advertising campaigns. Guggenheim views the partnership as positive for Roku and consistent with its August 2023 upgrade to buy. InvestingPro analysis shows Roku maintains a strong financial position with a healthy current ratio of 2.86 and more cash than debt on its balance sheet.
The firm highlighted that the deal contradicts bearish views that Amazon’s growth would come at Roku’s expense. Roku now has established partnerships with the four largest demand-side platforms, including Amazon, Alphabet (NASDAQ:GOOGL), and The Trade Desk—companies considered competitors in certain aspects of the connected TV marketplace.
Guggenheim noted the partnership should provide growth drivers for two key monetization areas for Roku: connected TV inventory and opted-in consumer data. The firm believes the "exclusivity" element of the agreement relates to using first-party Roku viewer data for targeting across inventory purchases beyond Roku’s own inventory.
The partnership is expected to begin contributing to Roku’s financial performance in early 2026, with growth accelerating throughout that year. Guggenheim maintains its 2026 Platform revenue growth estimate at 13%, ahead of the 12% consensus, reflecting confidence in Roku’s execution on growth opportunities. The company has already demonstrated strong growth momentum, with revenue increasing 17.3% in the last twelve months. Discover more insights about Roku’s growth potential and 12 additional exclusive ProTips with a subscription to InvestingPro.
In other recent news, Roku Inc. has announced an exclusive partnership with Amazon that aims to create the largest authenticated Connected TV (CTV) reach in the United States. This integration will allow Amazon DSP advertisers to access over 80 million U.S. CTV households by the fourth quarter of 2025, offering enhanced audience targeting and ad measurement capabilities. Analysts have responded positively to this development, with Loop Capital upgrading Roku’s stock rating from Hold to Buy and raising its price target to $100, citing the partnership’s potential to improve advertising efficiency and targeting precision. BofA Securities also raised its price target for Roku to $100, maintaining a Buy rating, and noted that the partnership is expected to have a significant impact on Roku’s results starting in 2026. Citizens JMP reiterated its Market Outperform rating and emphasized the importance of Roku’s new home screen features, which are designed to enhance content discovery and navigation. These developments reflect Roku’s ongoing efforts to expand its advertising capabilities and monetize its user base more effectively. The partnership with Amazon is seen as a strategic move to leverage both companies’ strengths in the streaming and advertising spaces.
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