Roku Stock (NASDAQ:ROKU) soared by 25% on Friday, marking the most substantial daily percentage gain since May 2019. The surge was prompted by Roku’s optimistic quarterly revenue forecast, which raised investors’ confidence in the streaming device maker.
During afternoon trading, Roku’s stock reached an impressive 25.3% increase, valued at $85.45. Notably, the company’s stock value has more than doubled since the beginning of the year. This rally added approximately $2.5 billion to Roku’s market capitalization, bringing it to a noteworthy $12 billion.
The positive momentum was further fueled by Roku’s better-than-expected financial results for the quarter ending in June. The company’s robust guidance exceeded consensus estimates, with a significant boost attributed to the upswing in digital ad sales. This encouraging outlook mirrored similarly upbeat forecasts from other industry giants, such as Meta Platforms (NASDAQ:META) and Alphabet (NASDAQ:GOOGL), who both reported improved ad sales in their recent quarters.
As a result of this positive news, Meta’s shares rose by approximately 4%, while Alphabet experienced a gain of about 3%, contributing to a 1% overall increase in the S&P 500 index (.SPX).
In response to the company’s impressive performance, several brokerages raised their price targets on Roku. D.A. Davidson increased its price target to $81 and maintained its buy rating on the stock. The firm praised Roku’s confidence in leveraging the ongoing shift of linear TV advertising dollars to over-the-top (OTT) platforms. However, D.A. Davidson analysts acknowledged the prevailing challenging ad trends that are expected to persist during the second half of the year.
Roku also reported a notable increase in active accounts, with a gain of 1.9 million from the previous quarter, bringing the total number of active accounts to an impressive 73.5 million.
Featured Image: Megapixl
Author Faith Yakubu 
