Goldman Sachs Slashes Netflix Price Target prior to Tuesday Earnings

Goldman Sachs and Raymond James have slashed their 12-month forecasts for Netflix Inc. (NASDAQ: NFLX) on concern that rising interest rates will hinder the valuation of the Company, which reports earnings on Tuesday after the bell.

Goldman on Monday laid out a bullish case for the upcoming Netflix quarterly earnings but still lowered its “12-month price target from USD 470 to USD 430 to reflect the contraction in broader internet multiples.”

“While broader market performance and rising rates concerns have been more important factors for stock price performance, we believe that upside to consensus expectations and what the strength in subscriber net additions says about Netflix’s business, beyond just guidance for the next quarter, is likely to be a positive catalyst for the stock,” Goldman’s Heath Terry said in a note to clients.

Raymond James also lowered its expectation for Netflix stock to USD 400 a share from USD 445 a share, saying the streaming Company’s growth will slow as interest rates continue to rise.

Netflix shares fell 6.1% last week amid a broader market sell-off from concerns over rising interest rates, escalating trade tensions and tighter monetary policy. The stock fell 0.5% in premarket trading Monday from its previous close of USD 339.56 a share.

“We have lowered our target price by 10% to USD 400 to reflect a rising interest rate environment,” Raymond James analyst Justin Patterson said in a note Monday.

Patterson said Raymond James remains “bullish” on Netflix “as upside drivers to revenue remain large” and “negative catalysts,” such as the competitive threat of other streaming services, “appear low.”

Citigroup on Friday called for investors to buy the dip, saying the stock’s tumble last week represents an entry point. “We view the recent sell-off as an opportunity to own a high-quality, recurring revenue franchise with attractive upside potential,” Citi said.

Citi has a USD 375 a share price target on Netflix.

4 Comments
  1. Robert Henderson 1 month ago
    Reply

    Goldman could be stirring up the pot and shaking out investors, I doubt Netflix can make a record breaking move yet again. I think $GS is looking to load up shares later in the week. $NFLX could possibly go sub -$300 depending on financial results

    • Derek Petrella 1 month ago
      Reply

      Man $NFLX earnings is crucial for the market. Company reports tomorrow after da close

  2. Chad Kusserow 1 month ago
    Reply

    Do all gaps fill? $nflx is on major support at the daily 200, and also painting a pretty convincing topping pattern. Green vertical is measured move if down.

  3. Devon Mattos 1 month ago
    Reply

    $GS Calls now @ $2.84 from $2.55 entry. Planning to hodl for a while.

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