On Wednesday, Jefferies increased Netflix (NASDAQ:NFLX)'s price target to $1,200 from the previous $1,000, while reiterating a Buy rating on the stock. Currently trading at $869.68, the streaming giant, with a market capitalization of $371.75 billion, appears overvalued according to InvestingPro Fair Value metrics.
The adjustment follows Netflix's impressive fourth-quarter performance, which saw the streaming giant add 19 million net subscribers, the highest in its history and significantly above the anticipated 13 million.
Jefferies expressed confidence in Netflix's subscriber growth trajectory, noting that the fourth quarter's success was not reliant on any single event or program. This diversified strength in content offerings suggests a robust and sustainable growth pattern for the company's subscriber base.
In addition to the subscriber growth, Netflix management also revised its full-year 2025 revenue guidance upward by $500 million, projecting a 12-14% increase, or 14-17% excluding foreign exchange impacts. This is despite facing a $1 billion headwind from foreign exchange.
The analyst's optimism extends to Netflix's financial outlook, with Jefferies raising its fiscal year 2025 and 2026 EBITDA estimates by 3%. The revised price target of $1,200 is reflective of the firm's increased confidence in Netflix's future earnings potential.
Netflix's strong fourth-quarter results and the subsequent increase in revenue guidance underscore the company's continued growth in a competitive streaming landscape. With the new price target, Jefferies signals its belief in Netflix's ability to maintain its momentum and further solidify its position in the market.
In other recent news, Netflix's fourth-quarter 2024 earnings report revealed revenues and operating income surpassing Wall Street expectations, with revenues exceeding estimates by approximately 1% and operating income 2% higher than consensus. Citi analyst Jason Bazinet maintained a Neutral rating on Netflix shares, with a price target of $920. Netflix's forecast for 2025 was adjusted upwards, surpassing Street estimates, reflecting the company's strong performance and future expectations.
Netflix has announced price increases for most subscription plans in the United States, Canada, Portugal, and Argentina. This move had been previously incorporated into Netflix's original outlook for 2025. Netflix's content lineup for 2025 and the expansion of its advertising tier were highlighted as key growth drivers.
Several financial firms have revised their outlook on Netflix. Barclays (LON:BARC) upgraded Netflix's stock from Underweight to Equalweight with a new price target of $900, citing strong revenue growth and cash flows. JPMorgan revised its price target for Netflix to $1,150, backed by the company's new $15 billion stock buyback authorization and expected average revenue growth of 14% in 2025 and 2026. TD Cowen also raised its price target to $1,150, maintaining a Buy rating based on a positive outlook for the company's revenue and subscriber growth.
Canaccord Genuity upgraded Netflix from Hold to Buy, setting a new price target of $1,150, following impressive revenue growth and paid memberships. Additionally, Oppenheimer raised its price target for Netflix to $1,150, citing strong margin dynamics due to conservative revenue guidance and modest price increases. KeyBanc increased its price target to $1,100, buoyed by the expectation of low double-digit percentage revenue growth and an annual earnings per share increase of over 20%.
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