Stifel Raises Netflix Price Target Ahead Of Q2 Print

For those who enjoy watching television and movies, it comes as no surprise that Netflix, Inc. NFLX continues to be an absolute juggernaut of a streaming service globally. 

Netflix has grown quickly: the company reported 125 million worldwide subscribers in the first quarter of 2018, according to Statista. This represents an increase of more than 100 million subscribers since the launch of streaming services in 2010. 

Stifel maintained a neutral stance on Netflix this week ahead of the company's July 16 second-quarter report. 

The Analyst 

Stifel analyst Scott Devitt maintained a Hold on Netflix and raised the price target from $345 to $406. 

The Thesis

Street forecasts are underestimating Netflix's domestic subscription growth, Devitt said in a note. (See the analyst's track record here.) 

"Netflix is on track to deliver over 5 million net domestic subscriber additions a year through 2020; higher U.S. penetration potential bodes well for international growth," the analyst said. 

So far in 2018, Netflix has been partnering with telecom companies like Sky and Telefónica, both of which have a massive following — a combined 30 million viewers, to be exact, according to Stifel. 

"The investment in international content is also hitting new highs, as the company is currently shooting original programming in 17 different countries (per Ted Sarandos in May), with over 100 international projects planned for launch this year," Devitt said. 

Stifel is maintaing its Hold rating on Netflix due to the belief that the stock is pricing in above-consensus results in the near term, the analyst said. 

Price Action 

Netflix shares were up 0.73 percent at $418.65 at the close Wednesday. 

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Tech Sector Earnings: What's Been Going On Ahead Of Q2 Reports? 

Photo courtesy of Netflix.