John Blackledge, an analyst covering the stock of Netflix has reaffirmed his outperform rating with $760 of stock price target. The analyst stated that the global roll-out for the streaming company and the strategy of making original content has been positively accepted by the investors. The optimistic sentiments of investors are represented by the substantial and continuous increase in share price during the first half of the year.
With around 2 days left for earnings release for the second quarter of FY15, the analysts highlighted some major points for shareholders to consider. These points include the subscription growth in international and domestic market for the period, the guidance expectations for growth for the next quarter, and update on plans and timing for more global expansion.
The management of Netflix Inc. has announced its strategy to introduce the service in three markets of Europe namely, Spain, Portugal, and Italy by the end of October 2015. The analysts added that details regarding companies launch in Japan, which was previously announced to be take place in the second half of current year, are also difficult.
The firm estimates for EBITDAA and revenue are high than consensus estimates, while lower for earnings per share. The firm expects quarterly revenue to come in at $1.66 billion, earnings of $0.27 per share and $119 million EBITDA. The consensus forecast for the same are $1.648, $0.31 and $113 million, respectively. The EPS forecast has been lowered slightly by the firm because of the foreign exchange volatility, while maintaining all other estimates.
The firm’s approximations for subscription growth are somehow in-line with that in the company’s guidance. The streaming giant’s subscribers are most likely to reach approximately 42 million by the end of the quarter, with total addition of roughly 600,000 subscribers, while for the global market segment it is expected to reach 22.8 million, with 1.9 million subscriber net additions.
On the whole, the Street sees the stock strengthen with 22 out of 44 analysts rated the stock as a Buy, 16 gave it a Hold, while only 6 suggests it a sell. The consensus stock price target stands at $657.60 specifies an adverse return potential of almost 3.4% compared to last closing price.
BTIG LLC analyst, Richard Greenfield has the most bullish outlook for Netflix stock, having a stock price target of $850, highest by any analyst covering the stock. However, lowest stock price target if $270 came from Wedbush analyst Michael Pachter.