Streaming giant Netflix (NASDAQ:NFLX) slipped fractionally in Wednesday afternoon’s trading despite another analyst, this time from Wells Fargo, coming out in favor of Netflix’s ad-tier operations.
There has been one problem with Netflix’s subscriptions these days: they’re on the decline overall. According to Wells Fargo’s Steven Cahall, paid password-sharing systems are on the decline, and that’s putting extra weight on the ad tier to drive growth. Earlier estimates suggested that Netflix could add 9.5 million subscribers in the fourth quarter, but Cahall noted that number could prove as high as 10.4 million instead. But with 2024’s second half, those numbers could easily decline as Netflix sweeps up the low-hanging fruit that is the paid sharing crackdown’s results.
Sentiment is Growing
It was just under a week ago that Oppenheimer backed up Netflix’s position in the market, calling it a proposition with a lot more revenue potential than expected. Then, Bank of America stepped in as its analysts declared it the “king” of streaming. It stated that it was “…increasingly clear that Netflix has won the streaming wars,” with it becoming increasingly clear that not every media company will be able to match its range and scale overall. While there’s still some threat from studios pulling their catalog titles, Netflix has been vigorously working to back up its supply with its own content.
Should I Buy or Sell Netflix Stock?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on NFLX stock based on 25 Buys and nine Holds assigned in the past three months, as indicated by the graphic below. After a 46.61% rally in its share price over the past year, the average NFLX price target of $496.63 per share implies 3.9% upside potential.
