What Happened:

Shares of streaming TV platform Roku (NASDAQ: ROKU) jumped 6% in the pre-market session after Wolfe Research analyst upgraded the stock from Peer Perform (Hold) to Outperform (Buy) and assigned a $93 price target. The price target implied a potential 25% upside from where shares traded before the upgrade was announced. The analyst added that "Amid industry and Roku-specific fears about connected TV, or CTV, ad sales, management's rising focus on monetization supports acceleration and should bury the profitability debate."

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What is the market telling us:

Roku’s shares are very volatile and over the last year have had 22 moves greater than 5%. In context of that, today’s move is indicating the market considers this news meaningful but not something that would fundamentally change its perception of the business.

The previous big move we wrote about was 20 days ago when the company gained 12.9% on the news that Guggenheim Securities upgraded the stock's rating from Neutral to Buy and assigned a price target of $75, citing "potential for revenue acceleration."

Roku is down 16.9% since the beginning of the year, and at $73.94 per share it is trading 30.8% below its 52-week high of $106.87 from November 2023. Investors who bought $1,000 worth of Roku’s shares 5 years ago would now be looking at an investment worth $500.34.

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