Netflix hit a record high August, and analysts think the stock has even more upside from here. Shares broke above the $700 mark in late August, reaching an intraday record of $711.33. On a closing basis, the stock scaled as high as $698.54 on Aug. 20. After pulling back slightly in recent days, shares closed at $701.35 on Friday. Shares are now around 44% higher year to date. The stock has managed to rally in 2024 alone in spite of intensifying competition in the streaming sector and a slowdown in consumer spending. However, many believe that Netflix has an advantage against its peers that helps insulate it from much of these worries. NFLX YTD mountain Netflix shares in 2024 “It’s hard for competitors to offer consumers the same type of value proposition they get on Netflix,” said Jason Helfstein, analyst at Oppenheimer. “Ultimately, Netflix wins the global content game.” The analyst holds an outperform rating and $725 price target on the stock. Macro resilience Analysts are enthusiastic about Netflix’s ability to weather through macro pressures, even with fears of a weakening consumer. Subscription services are generally more immune to such headwinds, JPMorgan analyst Doug Anmuth wrote in a note on Aug. 13. “In terms of macro and the consumer, while NFLX is certainly not immune, we believe the service represents compelling value, even with ongoing price increases,” said Anmuth. Anmuth has a $750 price target and overweight rating on Netflix. To be sure, the company will have to be tactical about the timing and magnitude of further price increases, said Wedbush analyst Alicia Reese. Nonetheless, she highlighted the relative value proposition Netflix provides to consumers even in tighter economic conditions. “Obviously if the wallet is tight, how you want to spend that share of wallet matters a lot. If you’re going to eat in more, if you’re going to be shopping less â you’re at home [and] going to be watching more Netflix,” Reese said. Reese is similarly bullish on the stock, with an outperform rating and $725 price target. Live sports streaming Helfstein and other analysts are bullish on the opportunity streaming live sporting events will have for Netflix. Two of the National Football League’s Christmas Day games will be streamed on the platform this year. Streaming live sports events may also help Netflix further expand its global reach â which is the company’s key competitive advantage, according to Reese. There are market opportunities into more “niche” sports such as cricket or Gaelic football, she added. Evercore also believes live sports events provide a “promising long-term greenfield revenue opportunity.” “Netflix is in the strongest position financially, fundamentally and competitively that we have ever seen,” analyst Mark Mahaney wrote in a research note on Monday. He has an outperform rating and price target of $750 per share. Although the stock may be relatively expensive over the next 12 to 18 months, the stock is promising for investors oriented toward the longer term, Helfstein noted. “When you think about the long term opportunity for Netflix, there’s really nobody who can challenge them right now,” Helfstein said.
Source Agencies
