This year has not been kind to Netflix (Netflix stock), which has struggled mightily. However, many Wall Street analysts are optimistic that a recovery will occur in 2023, and as a result, favorable ratings are accumulated on the company.
Overweight is the new recommendation analyst Steven Cahall of Wells Fargo has given Netflix shares. Previously, he had given it an equal weight rating. This was in response to J.P. Morgan, who had previously stated that they would maintain their Overweight ratings on the shares. Midway through November, the equity research analyst Jessica Reif Ehrlich at BofA Securities reactivated her coverage of the shares with a Buy recommendation. Currently, 21 of Netflix’s 45 analysts have a favorable outlook on the company’s stock, up from 15 around three months ago.
Cahall’s call on Netflix ( NASDAQ:NFLX ) comes when the stock has lost around 47% of its value this year, compared to the S&P 500’s fall of 17%. The company that provides streaming video reported decreases in members for the first two quarters of 2022. The level of competition is also increasing: Walt Disney (DIS) On Thursday, Disney+ began offering a streaming tier that is funded by advertisements and costs $7.99 per month, positioning itself as a competitor to Netflix’s basic ad-supported plan, which began offering its services in November for $6.99 per month.
When analysts believe that a stock is trading at a price significantly below its actual value or when shares of the company have experienced a significant price decline, and the analysts believe that investors are overlooking a favorable tailwind, they will frequently upgrade or reiterate a Buy rating for the stock. Netflix may have brighter days ahead, according to BofA, J.P. Morgan, and Wells Fargo. This may be due to the ad-supported streaming service being a winner in the coming years, or it may be due to an improvement in the service’s content.
According to Cahall, “all the ingredients were in place for a more challenging NFLX performance in 2022.” However, “when we look at the mosaic as a whol...
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