Baird upgraded ROKU to "outperform" with a new $90 price target
Roku Inc (NASDAQ:ROKU) stock is 2.8% higher at $70.80 at last glance following a bull note at Baird. The analyst upgraded shares of the streaming giant to "outperform" from "neutral," and hiked its price target to $90 from $70.
In its note, Baird said, despite ROKU's 23% year-to-date deficit, there's plenty of long-term potential that investors are "overlooking." In addition, the brokerage firm cited industry trends, the company's strategic innovations, and early performance indicators as catalysts for its upgrade.
Coming into today, almost half the covering analysts were bullish, but there's still room for sentiment to improve. Specifically, 14 still rate Roku stock a tepid "hold" or worse, which means more upgrades could be on the way.
Options are affordably priced, too, per ROKU's Schaeffer's Volatility Index (SVI) of 43% that ranks in the 5th percentile of annual readings. This implies that the options pits are pricing in relatively low volatility expectations.
While the equity is down considerably since the start of the year, things look to be turning around. Roku stock has added nearly 20% over the last six months, and is 10.9% higher in November. The $70 area is back in place as a layer of support, as ROKU looks to snap a four-day losing streak.