Shares of The Trade Desk Inc . (NASDAQ:) and Roku (NASDAQ:) saw notable gains Monday, attributed to speculation of a potential merger between the two companies. The movement followed remarks by Guggenheim analyst Michael Morris, who opined that a merger would be advantageous for both entities.
Roku’s stock climbed by 9.5%, while The Trade Desk experienced a 4% increase. According to Morris, The Trade Desk could significantly expand its operating system ambitions through Roku’s extensive global streaming household reach, which exceeds 85 million. Conversely, Roku could benefit from utilizing its first-party viewer data and growing connected TV (CTV) inventory to meet the increasing demand from advertisers.
Morris further elaborated on the potential benefits, stating, “We believe that the positives of a vertical integration between TTD and Roku outweigh the incremental challenges and would best position each entity to effectively compete in the CTV market for the long term and to maximize entity value.” It is important to note that the transaction discussed by Morris is strictly hypothetical at this stage.
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