Netflix shares target raised to $700 on subscriber outlook

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On Tuesday, Netflix Inc. (NASDAQ:) saw its price target increased by Jefferies to $700, up from the previous target of $580. The firm has maintained a Buy rating on the streaming giant’s shares. The adjustment reflects an optimistic view on the company’s subscriber growth, driven by the anticipation that weaker competitors and the crackdown on password sharing will lead to more users paying for the service.

Jefferies’ decision comes amid expectations of a strong content lineup, including high-profile events like the Tyson/Paul fight and partnerships such as the one with WWE. These factors are anticipated to attract more subscribers. In response to these developments, Jefferies has also projected an increase in Netflix’s marketing expenses.

The firm’s analysis suggests that the combination of exclusive content and strategic initiatives will effectively turn non-paying users into subscribers. This transition is seen as a positive move that could bolster Netflix’s revenue and market position.

While Jefferies has raised its marketing cost estimates for Netflix, it has also indicated that its overall expectations are in line with the broader market consensus. The firm’s updated outlook is based on the belief that Netflix’s upcoming content and initiatives will deliver a competitive edge and drive subscriber growth.

The price target hike to $700 represents a significant increase and implies confidence in Netflix’s strategy and its potential to outperform in the streaming industry. The continued Buy rating underscores the firm’s belief in Netflix’s value proposition and its future prospects.

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