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Key Takeaways
- Netflix’s first-quarter earnings exceeded Wall Street expectations. Several analysts praised the company’s ability thrive in an uncertain economy.
- Bank of America analysts said Netflix has "sustainable growth drivers" that could make it a strong defensive choice in a tougher macroeconomic environment.
- Jefferies analysts said Netflix remains a "top pick" as the company rolls out its ad suite.
Analysts praised Netflix’s (NFLX), ability to thrive in the face of economic uncertainty, after it delivered first-quarter results that exceeded Wall Street expectations.
Bank of America’s analysts said that the streaming giant had shown “sustainable growth factors” which could make the stock an attractive defensive choice for investors. In the company’s earnings conference call, co-CEO Greg Peters stated that Netflix “has generally been quite resilient” in tougher economic times.
Netflix attributed the better-than-expected performance in part to higher subscriptions and ad revenue. Peters stated that the company is expecting to double its advertising revenues this year, when it launches its ad-tech suite. Analysts at Jefferies said Netflix is still a “top pick” as the advertising tiers scale, price increases are implemented, and expectations remain realistic.
Netflix executives have reportedly stated that they want to double the $39 billion in revenue generated by the company last year. This is expected to be announced on Thursday. Ted Sarandos, co-CEO of Netflix, cautioned analysts to not take this as an official forecast.
BofA maintained its bullish rating and price target of $1,175 for Jefferies and $1,200 for BofA. KeyBanc analysts remained at $1,000 and Needham reiterated their $1,126 price target. These estimates suggest a 23% increase in the closing price of Thursday. (The U.S. market is closed on Friday to observe Good Friday).
