Sterne Agee CRT Remains Sidelined on Netflix (NFLX) Following a Mixed 4Q
Sterne Agee CRT reiterated a Neutral rating on Netflix (NASDAQ: NFLX) following the company's 4Q earnings report. NFLX reported 4Q revenue of $1.823B and EPS of $0.10 vs. consensus of $1.826B and $0.02 respectively. While the domestic market is slowing, international subscriber trends are accelerating due to increased penetration and rollout in new countries.
Analyst Arvind Bhatia commented, "Netflix is well on its way to being a global leader in Internet TV. While the domestic market is slowing (maturing), international subscriber trends are accelerating due to increased penetration and rollout in new countries. We see the global subscriber base more than doubling in the next five years and significant margin improvement as international becomes profitable and domestic segment experience even greater operating leverage. Much of this, though, seems to be in the stock already. Also, we are unclear on the trajectory of international growth beyond the near-to-medium term. Internationally, will Netflix remain a niche service catering to the “elite,” given its price point or will it become a mass-market service (if it lowers prices)?"
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Shares of Netflix closed at $107.89 yesterday.