Analysts are optimistic about the future growth of Netflix Inc. (NASDAQ: NFLX).
Benjamin Swinburne, a Morgan Stanley analyst, has reiterated that Netflix is “overweight”, and he expects further growth as Netflix prepares for its second quarter financial results to be released on the 18th of July.
Swinburne increased his Netflix price target to $780. This represents a 20% potential upside.
This optimism is attributed to Netflix’s strong performance. He expects “continued results in the second half 2024.”
Netflix is not attractive to income investors despite its strong performance. It does not offer a dividend.
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TD Cowen also has a bullish view on NFLX
John Blackledge, TD Cowen analyst, recently increased his Netflix price target to $775.
Blackledge and Swinburne both highlight Netflix’s success in monetizing password sharing, as well as new revenue streams like gaming, advertising and possibly live sports, as the key drivers of growth.
Netflix’s large catalogue of movies in multiple genres has been hailed as an advantage.
Price increases on major markets may also be catalysts of growth.
Netflix made these bold calls after it laid off its employees from its film division earlier in the year. This shows its commitment to cost-efficiency and growth.
Netflix has been in a steady uptrend for the last two years, with higher highs as well as higher lows. The 50-week MA crossed over the 200-week MA in February to form a golden cross.
But several technical indicators suggest that the buying trend may be slowing down. Trading volumes this year have been below the average compared with 2022 or 2023. Second, while Netflix stock rose to a high of several years last week, relative strength (RSI), formed a divergence in a negative direction by making a lower high. The stock tried to reach a record high but failed.
Netflix’s Q2 Earnings: What can we expect?
Netflix will report their Q2 results in this coming week. They expect a revenue growth of 16% to $9.49 Billion.
Analysts expect the streaming giant to earn $4.7 per quarter, up from $3.29 a share one year earlier.
Investors are interested in growth of subscribers, particularly in the paid-tier.
Netflix’s sequential growth is likely to be slower in Q2 due to the “typical seasonality.”
The potential for growth will be monitored closely, including the international sales.
Netflix recently made a statement to its shareholders in which it highlighted the unique combination that Netflix has of strong content, excellent recommendations, a wide reach and a passionate fan base, all driving healthy engagement and business growth.
As Netflix is preparing to announce its earnings for Q2, analysts are optimistic about the growth of Netflix. The streaming giant, with its new revenue streams, strategic positioning and market position, is well-positioned to continue on its upward path, providing significant upside for investors.
The post Netflix Stock Price Target Raised Ahead of Q2 Earnings: Analysts See 20% Upside Potential may be updated as new information unfolds.
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