In a report published by Goldman Sachs, Netflix NFLX is upgraded to Buy.
Goldman Sachs said that it is upgrading Netflix shares to Buy from Neutral and raising its price target to $300 from $210, implying 50% upside. “With shares down almost 20% in the last month and trading at a 1.0X 2012E PEG, we believe that NFLX shares overreacted to more visible signs of competition, while at the same time, sub momentum has been better than expected, Canada is near 10% penetration in 6 months, and our proprietary survey shows explosive growth for online video. As a result, we raise our 2015E paid sub estimate from 50 mn to 60 mn and our EBITDA margin from 16% to 20%. Our 2011- 2013 EPS estimates are now $4.56/$6.72/$8.72, up from $4.52/$6.21/$7.58.”
Netflix closed yesterday at $201.20.
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