UPDATE: Bank of America Downgrades Netflix to Underperform on Streaming Business Concerns

Bank of America lowered its rating on Netflix

from Buy to Underperform while maintaining a $72 price target. Bank of America commented, "We are downgrading Netflix to Underperform from Buy as the stock exceeded our $72 price objective (PO). Throughout the quarter, our concerns have grown surrounding the health of the domestic streaming business and timing of international streaming profitability. With the stock increasing 31% over the past two-weeks, we now believe the risks outweigh the reward heading into Q3. Our $72 PO is based on a sum-of-the-parts analysis assigning a 20x multiple to the domestic streaming segment, a 6x multiple to the dying domestic DVD segment and gives neither credit nor penalty for the international streaming segment." Netflix closed at $73.52on Monday.