Raymond James Upgrades Netflix to Outperform

Research analysts at Raymond James have upgraded their rating on Netflix (NFLX) from Market Perform to Outperform and set a price target of $450, suggesting 29 percent upside.

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“Netflix continues to demonstrate solid domestic growth and accelerating international growth – while domestic is ~3x the size of international today, Netflix expects international to be larger longer-term. We believe Netflix can reach ~ 55 million long-term domestic subs and 60 million plus international subs.” Raymond James said in a note to clients

“domestic streaming margins increased 460 bp y/y (driven by lower marketing and content cost leverage) while Netflix noted international is on a trajectory to reach profitability this year in its currently launched markets” it added

“Netflix will begin increasing prices for new members in 2Q by a modest $1-$2 and existing members will stay at current prices for a “generous” time period – we believe price increases will enable Netflix to continue to invest in higher quality content (i.e., House of Cards) and thus attract more users” it said

Shares of Netflix (NFLX) closed at $348.49 on Monday.

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