Wedbush analyst Michael Pachter maintained Netflix Inc (NASDAQ:NFLX) with an Outperform and raised the price target from $615 to $725.
After a year of significant growth, the analyst removed Netflix from Wedbush's Best Ideas List (BIL).
His quarterly survey indicates a seasonal deceleration in subscribers (though likely continued year-on-year growth) and an expansion of subscribers on Netflix's ad tier.
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As long as global trends remain consistent and the ad market continues to improve this year, he expects Netflix to continue to report strong results.
With that said, some of the significant catalysts that drove his BIL placement have been priced in, including benefits from the password-sharing crackdown and reduced churn from the introduction of the ad tier.
Pachter noted the ad tier will continue to limit churn, and it has a significant opportunity to expand its advertising revenue in 2024 and beyond.
He noted Netflix has reached the right formula with global content creation, balancing costs, and increasing profitability.
Pachter noted Netflix will continue to expand profitability and generate increasing free cash flow, supporting his ...