Analysts reacted positively to the news for both Roku and Comcast. Roku will receive “top-end premium inventory and subsequent pricing leverage on its [connected TV] premium ad bundles,” in addition to negotiating power with other major networks, said Rosenblatt Securities.
The firm has a buy rating and $195 price target on shares of Roku.
Analysts at Benchmark said the deal could help Peacock. Benchmark has a buy rating and $54 price target on Comcast.
Roku recently traded at $183.98, up 14.65%, and has climbed 37% this year. Comcast recently traded at $43.69, down 3.47%, and has slid 3% year to date.
Peacock provides access to more than 20,000 hours of on-demand movies and shows, live news and sports programming from NBCUniversal and beyond. It offers free and paid versions
“Audience demand for compelling content is fueling a surging shift to streaming for a majority of American households today,” Tedd Cittadine, vice president of content acquisition for Roku, said in a statement. “We’re focused on delivering the kind of high-quality news and entertainment content Roku users want and love, and we’re excited to welcome Peacock.”
Last week, KeyBanc initiated coverage on Roku with an overweight rating and $228 price target.
Investors underappreciate the competitive moat and monetization potential of the streaming-tech company, KeyBanc analysts said. They expect “faster revenue growth than consensus contemplates," said analyst Justin Patterson.