Netflix stock price target lowered to $1,400 by Wedbush on slower growth

Investing.com - Wedbush has lowered its price target on Netflix (NASDAQ:NFLX) to $1,400 from $1,500 while maintaining an Outperform rating on the stock. The streaming giant, which has delivered an impressive 56.9% return over the past year and currently trades at a P/E ratio of 52.9x, appears overvalued according to InvestingPro analysis.

The adjustment reflects Wedbush’s concerns about Netflix’s slower growth pace anticipated in the second half of 2025, leading the firm to apply a 37x P/E multiple on its updated 2027 EPS estimate of $38, down from the previous 38x multiple.

Wedbush indicated that Netflix needs to demonstrate that its advertising program can accelerate growth soon to justify its high valuation multiple in the market.

The research firm outlined several potential growth drivers for Netflix’s advertising revenue, including adding and improving live events, enhancing targeting and interactivity capabilities, expanding advertising partnerships, and adding purchasing functionalities.

Despite the price target reduction, Wedbush reiterated its Outperform rating on Netflix stock, noting there remains upside potential to the revised $1,400 target.

In other recent news, Netflix reported third-quarter 2025 revenue of $11.5 billion, marking a 17.2% year-over-year increase, which met expectations and showed slight acceleration from the previous quarter’s growth rate. However, the company’s operating income fell short of guidance due to a $619 million charge related to a Brazilian tax dispute. In response to these results, Rosenblatt Securities raised its price target for Netflix to $1,530, maintaining a Buy rating. Similarly, Canaccord Genuity upheld its Buy rating with a price target of $1,525, despite noting limited upside for the fourth quarter.

Conversely, Piper Sandler lowered its price target to $1,400 from $1,500, while still keeping an Overweight rating. Goldman Sachs reiterated a Neutral rating with a $1,300 price target, citing factors like strong content execution and operating margin expansion as key influences for future performance. Raymond James maintained its Market Perform rating, noting that Netflix’s third-quarter revenue was slightly below expectations due to foreign exchange movements, although the fourth-quarter guidance aligned with market expectations. These developments reflect the varied perspectives among analysts regarding Netflix’s financial outlook.

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