Netflix Inc (NFLX)

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Netflix stock rises as Goldman stays bullish, but cuts price target below Street average
By: MarketWatch | October 10, 2019

Shares of Netflix Inc. NFLX, +2.28% surged 1.4% in morning trading Thursday, after Goldman Sachs analyst Heath Terry reiterated his bullish stance ahead of the streaming video giant's third-quarter results due out next week, but slashed his price target to below the Wall Street average. While Terry expects Netflix to report results "roughly in-line" with guidance of 7 million net subscriber additions, he said data showing that app downloads have been declining suggest a "modest risk" to the downside. He reiterated the buy rating he's had on the stock for at least the past three years, but cut his price target to $360 from $420, citing reduced earnings expectations and valuation contraction among internet names. The average target of the 40 analysts surveyed by FactSet is $384.97. Terry cut his 2019 EPS estimate to $3.17 from $3.24. He remains bullish, he said, because he believes the impact of a strong fourth-quarter content slate and a more stable pricing environment will boost fourth-quarter subscriber growth above current Street expectations. Separately, UBS analyst Eric Sheridan maintained his buy rating but cut his price target to $370 from $420. The stock has tumbled 28.8% over the past three months, amid concerns over intensifying competition, while the S&P 500 SPX, +0.57% has slipped 2.3%.

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