Netflix (NFLX) PT Raised to 'Street High' $487 at Bernstein; Sees Long Term Benefits from Stay-at-Home Era

Bernstein analyst Todd Juenger raised the price target on Netflix (NASDAQ: NFLX) to a 'Street High' $487.00 (from $423.00) while maintaining an Outperform rating, saying they expect the stay-at-home era to have both near-term and long-term benefits for Netflix.

"We expect the near-term benefits include some combination of reduced churn, increased gross adds, and higher ARPU (trade-ups to plans allowing more concurrent streams)," Juenger commented. "We believe as an increasing number of people experience Netflix, at an especially high rate of usage, they will be loath to go back to life without it. The adoption of streaming will be accelerated and further ingrained into the culture."

The firm tweaks their Base case for 2020 (+2mm subs, to 30mm net paid adds in FY20).

The biggest negative disruption for Netflix will be production stoppages, but the analyst said even that is a big relative advantage for them. "Netflix has a significant pipeline of new content still in place to be released over the next several months, and a massive collection of recent originals from the past 3+ years, many of which were lost in the sheer volume and remain undiscovered by consumers," the analyst commented.

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