Roku Stock: A Top Pick for 2026—Why Analysts Are Bullish on Its Future

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Roku Stock: A Top Pick for 2026—Why Analysts Are Bullish on Its Future

In a world dominated by streaming platforms like Netflix and Amazon Prime Video, Roku has quietly positioned itself as a critical player in the industry, and now Wall Street is taking notice. With two major financial institutions, Jefferies and Wedbush, giving Roku a strong vote of confidence, many experts believe the company is primed for substantial growth in the coming years. Additionally, a recent upgrade from Morgan Stanley has further fueled optimism around Roku's market potential. Here's why Roku stock is gaining attention and how it could play a key role in the streaming sector's future.

Roku’s Strategic Position in the Streaming Ecosystem

Unlike direct competitors like Netflix and Hulu, Roku doesn’t create content; instead, it serves as the bridge between content providers and viewers. The company manufactures streaming devices and licenses its operating system to TV makers, enabling users to access popular platforms like Netflix, Paramount Plus, and others. This unique position has allowed Roku to thrive even as the so-called “streaming wars” heat up.

Analysts at Jefferies recently upgraded Roku’s stock from Hold to Buy and raised their price target to $135 from $100, emphasizing the company's strong future prospects. Jefferies analyst James Heaney has listed Roku as his top small- and mid-cap pick for 2026. Similarly, Wedbush added Roku to its “Best Ideas List,” reiterating an Outperform rating and increasing its price target from $115 to $130.

These upgrades are supported by Roku’s steady growth in platform revenue—a category that includes advertising and subscription services. This revenue stream is at the heart of Roku’s business, accounting for the majority of its earnings. Jefferies forecasts 16% growth in platform revenue by 2026, and they believe it could reach 20% under optimal conditions. Given that Roku's platform revenue grew 17% year-over-year in the third quarter of 2023, analysts are increasingly bullish about the company's prospects.

The Power of Strategic Partnerships

Roku’s ongoing partnership with Amazon is a pivotal factor in the company's future. In collaboration with Amazon's ad-buying system, Roku has made it easier for marketers to target specific users. This partnership, coupled with increased ad spending ahead of major events like the 2026 midterm elections, is expected to provide a significant revenue boost.

Moreover, Roku’s move to cater to small- and medium-sized businesses with its self-serve ad manager and the launch of interactive ads that direct viewers to products shows that Roku is becoming increasingly versatile in attracting ad dollars. The company's growing ecosystem of partnerships is one of the key reasons why analysts are optimistic about Roku's continued success.

Why Roku’s Streaming Revenue is Key to Growth

One of the most promising aspects of Roku's business is its focus on streaming revenue growth. As consumers continue to cut the cord and abandon traditional cable, platforms like Roku are poised to benefit. This shift to connected TVs is a significant trend that has helped fuel the growth of Roku’s advertising revenue.

Morgan Stanley recently upgraded Roku’s stock from Hold to Buy, citing accelerated platform revenue growth and the expansion of strategic streaming partnerships as key reasons for the upgrade. According to Morgan Stanley, the increasing demand for streaming services globally and the company’s ability to tap into this demand through advertising and strategic partnerships will continue to fuel Roku’s growth trajectory. Despite Roku's stock having been volatile—reflecting broader industry challenges—the market reaction has been overwhelmingly positive.

The Road Ahead: What to Expect in 2026 and Beyond

Roku's stock has risen by 44% in 2023, but it's still down over 75% from its peak in 2021. However, investors are encouraged by Roku's financial health, clean balance sheet, and the continued double-digit growth in its platform revenue. With its strong advertising business, growing partnerships, and a user base that continues to grow, Roku’s long-term prospects are looking increasingly promising.

While Roku's stock is far from its 2021 highs, its path to recovery is backed by structural growth in advertising, strategic alliances, and innovation in ad products. Both Jefferies and Wedbush expect Roku to see accelerating revenue momentum through 2026 and into 2027, positioning it as a top pick for investors who are willing to look beyond short-term volatility.

Conclusion: Is Roku a Stock to Watch in 2026?

Roku is not just a player in the streaming wars—it’s a key enabler of the entire industry. With its unique position as a streaming platform provider and its growing revenue from ads and partnerships, Roku is poised for continued success. The recent upgrades from both Jefferies and Morgan Stanley reflect the market’s optimism about Roku’s future. As the shift from traditional cable to connected TV continues, Roku stands to benefit, offering investors a potential long-term growth story.

While challenges remain, the company’s strong fundamentals, innovative ad solutions, and strategic partnerships position Roku as a stock worth watching in 2026 and beyond. For investors looking to tap into the growing streaming ecosystem, Roku could be the next big winner.

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