Analysts have expressed increased optimism about Netflix following its strong performance in the third quarter. Netflix shares rose over 6% in premarket trading on Friday after the company announced earnings of $5.40 per share and revenue of $9.83 billion, surpassing Wall Street’s expectations of $5.12 per share and $9.77 billion in revenue, as reported by LSEG. The company’s subscriber growth also exceeded predictions, with an increase of 5.1 million subscribers compared to the anticipated 4.5 million, bringing their total subscriber base to 282.7 million.
JPMorgan analyst Doug Anmuth reaffirmed his strong positive outlook on Netflix, predicting more balanced growth next year as the company’s advertising tier expands. Anmuth maintained his overweight rating on the stock and increased his price target by $100 to $850, suggesting a potential 23% rise from Thursday’s closing price. He highlighted Netflix’s global scale, strong user engagement, and diverse content offerings as key factors positioning it as a default choice for consuming TV, film, and long-form content.
Morgan Stanley analyst Benjamin Swinburne also reiterated his overweight rating on Netflix, raising his price target by $10 to $830, indicating a potential 20% increase. Swinburne described the earnings results as successful and identified further growth opportunities for Netflix. According to him, the company is set to remain the largest and fastest-growing streaming service globally as it moves towards 2025, driven by its ability to increase earnings by 20-30% annually through additional growth avenues such as paid sharing, ads, live content, and games.
Pivotal Research maintained its buy rating and raised its price target to $925, noting Netflix’s impressive scale and ability to invest in growth initiatives. Bernstein retained its market perform rating but increased its price target to $780 from $625, recognizing Netflix’s stronger content slate for the fourth quarter and future growth prospects. Bank of America reiterated its buy rating and increased its price target to $800, citing Netflix as one of the best-positioned companies in media with several growth drivers, including its expanding ad business.
UBS also reiterated its buy rating, raising its price target to $825 from $750, viewing Netflix as the primary beneficiary of a rationalizing direct-to-consumer competition. Meanwhile, Goldman Sachs maintained a neutral rating with a $750 price target, highlighting ongoing investor discussions about price increases and the company’s forward operating margin, while acknowledging operational advantages reflected in quarterly estimate revisions.
