Mizuho Securities Remains Neutral as Netflix (NFLX) 4Q Shows Slowing U.S. Market
Mizuho Securities reiterated a Neutral rating on Netflix (NASDAQ: NFLX), and raised the price target to $120.00 (from $115.00), following the company's 4Q earnings report. revenue of $1.8b was in line with Street expectations, while EPS of $0.10 came in higher than consensus at $0.02 (primarily due to a tax credit). U.S. subs came in below expectations, while International subs materially exceeded expectations. U.S. sub adds missed expectations for the second quarter in a row due to EMV issues and law of large numbers, but paid subs came in better than expected.
Analyst Neil Doshi commented, "This was not a clean quarter - U.S. subs came in below expectations, while International subs materially exceeded expectations. The U.S. sub adds were impacted by EMV issues as well as law of large numbers. And with two pricing increases impacting a large number of subs later this year, we believe that churn could tick up. That said, International remains a key driver of growth and future profitability. Valuation still remains rich, thus the Neutral."
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Shares of Netflix closed at $107.89 yesterday.