What analysts think about Netflix stock ahead of earnings

On By Littum

Key takeaways

  • Netflix is ​​set to report its fourth quarter results after the market closes on Tuesday.
  • A majority of analysts covering Netflix, followed by Visible Alpha, have a “buy” or equivalent rating on the company’s stock, with a consensus price target implying more than 5% upside.
  • Netflix’s ad-supported plan has been a huge success and has eased the pressure on Netflix to add so many new subscribers, analysts said.

Netflix ( NFLX ) is set to report fourth-quarter results after the closing bell on Tuesday, with analysts mostly bullish on the streaming giant.

Of the 19 brokers covering Netflix tracked by Visible Alpha, 14 have a “buy” or similar rating, compared to four “hold” ratings and one “sell.” The consensus price target is around $905, about 7% higher than the stock’s Thursday close.

Wedbush Securities this week issued a $950 target on the stock, pointing to Netflix’s “almost insurmountable lead” in the streaming wars. The company’s $6.99 ad-supported subscription tier has limited customer turnover, the firm said, “lowering the pressure to add new subscribers,” which should continue to drive revenue growth over the next few years.

JPMorgan, Oppenheimer Lower Netflix Price Target

JPMorgan, which lowered its price target to $1,000 from $1,010, said the streamer’s ad-supported tier and password sharing “should further expand NFLX’s subscriber base while growing high-margin earnings.” Oppenheimer also trimmed a bullish price target this week.

Overall, Wall Street expects Netflix’s revenue for the latest quarter to grow 15% year-over-year to $10.13 billion and earnings to rise to $1.84 billion, or $4.23 per share. share, from $937.8 million, or $2.11 per share. stock.

Notably, Netflix will no longer report quarterly subscriber numbers beginning with Tuesday’s results.

The stock, which closed yesterday just above $842, is up about 70% over the past 12 months.