MKM Partners Raises Price Target on Netflix (NFLX) Following 3Q15 Earnings Results
MKM Partners reiterated a Buy rating on Netflix (NASDAQ: NFLX), and raises the price target to $145.00 (from $130.00), following the company's 3Q15 earnings results. U.S. net paid additions of 1.01mn were well below guidance of 1.45mn. Gross additions were inline/ahead of expectations but involuntary churn was greater than expected.
Analyst Rob Sanderson commented, "NFLX reported a mixed quarter with a miss/lower in U.S. subscriber additions and a beat/raise in international. This was as we previewed and we are not concerned with our bullish thesis. We are updating our estimates, with a steeper ramp up in ARPU offset by somewhat lower domestic subs and higher international spending to support next year's completion of global availability. Our 2021E EPS power is increased to $12.00 per share on higher ARPU. Our new 12-month price target of $145 (from $130) is 25x EPS discounted at 25% per year."
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Shares of Netflix closed at $110.23 yesterday.