Ruplu Bhattacharya, Bank of America analyst, reiterated his Buy rating Roku (NASDAQ) Stock and decreased the price target from $235.00 to $145.00 per Share

This is due to near-term headwinds mainly related and supply chain, as well as ad spend.

“We view these headwinds as transitory and expect a stronger 2H22. Roku might benefit from subscribers moving to Ad supported platforms free of charge if Netflix (NASDAQ: ) tightens password sharing. Roku might also be able to benefit from an agreement for carriage with NFLX, which offers Ad-supported versions. Some investors have asked us if Roku’s growth is peaking in the U.S. Our analysis indicates that Roku has meaningful growth remaining in the U.S., in addition to growth from international markets,” Bhattacharya said in a client note.

The analyst says that the near-term weakness present in Roku shares is “transitory” as he expects things to improve in the second half of the year.

“Like last year, we expect Roku to do well during the advertising upfronts (last year doubled dollar commitment and 42% of advertisers who committed to Roku during the upfronts were new). Roku’s themes for this year’s upfronts: The Roku Channel, The OneView advertising platform and the new Roku Brand Studio,” Bhattacharya added.

Roku stock was down 5.5% on Wednesday pre-open. Stocks have fallen by approximately 65% Year to Date.

By Senad Karaahmetovic