Netflix (NFLX) Price Target Raised to $600 at Needham & Company

Needham & Company analyst Laura Martin reiterated a Buy rating and boosted her price target on Netflix (NASDAQ: NFLX) to $600.00 (from $525.00) following strong Q1 U.S. and international subscriber numbers.

Martin commented, "The hardest part of investing in NFLX (our view) is its extreme volatility and large losses if you’re on the wrong side of the trade. NFLX fell 20% on its 3Q14 call, rose 20% on its 4Q14 call, and rose >10% on its 1Q15 earnings call. What we liked about NFLX’s 1Q15 included: 1) subscriber overdelivery in both the US and offshore; 2) US profit margins above our estimates; 3) only 15% cost increase estimated to buy global content rights; 4) faster offshore adoption of NFLX than we had expected. A potential dark cloud from 1Q15 was the growth in content obligations to $9.8B plus $3-5B for output agreements based on future box office performance. In addition, we wonder if churn will rise in 2Q15 and 3Q15 owing to lower original series being released vs 1Q15."

The firm raised FY 2015 revenue estimates from $6.73B to $6.894B and EPS from $3.34 to $3.41.

For an analyst ratings summary and ratings history on Netflix click here. For more ratings news on Netflix click here.

Shares of Netflix closed at $475.46 yesterday.

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