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Investing.com - Jefferies maintained its Buy rating and $1,500 price target on Netflix (NASDAQ:NFLX) ahead of the streaming giant’s third-quarter earnings report, due October 21. The target represents potential upside from the current price of $1,219, though InvestingPro analysis suggests the stock is currently trading above its Fair Value.
The firm expressed continued confidence in Netflix’s prospects, highlighting expectations for revenue growth exceeding 17% year-over-year on an ex-FX basis in Q3, compared to 17% growth in the second quarter. This optimism is supported by Netflix’s strong financial health, evidenced by its perfect Piotroski Score of 9 and "GREAT" overall financial health rating from InvestingPro.
Jefferies anticipates Netflix will guide for mid-teens revenue growth in the fourth quarter, supported by strong content performance including "KPop Demon Hunters" and impressive Nielsen data from July and August.
While Q3 results remain important, Jefferies identified the company’s fiscal year 2026 annual guidance, expected in January 2026, as the "key catalyst for a share re-rating" rather than the upcoming quarterly report.
The firm noted investors will likely focus on engagement growth reacceleration, which reached only 1% year-over-year in the first half of 2025, as a critical metric in the upcoming results.
In other recent news, Netflix has been at the center of several notable developments. The streaming giant announced a multi-year global partnership with AB InBev, allowing for collaboration on co-marketing campaigns and consumer activations across various global and regional titles. Meanwhile, Netflix’s stock received an upgrade from Seaport Global Securities, which raised its rating from Neutral to Buy, citing potential ad revenue growth. On the other hand, Goldman Sachs lowered its price target for Netflix to $1,300, maintaining a Neutral rating due to concerns over streaming competition.
Morgan Stanley removed Netflix from its Top Pick list, although it maintained an Overweight rating. Additionally, Bernstein reiterated its Outperform rating on Netflix while discussing the company’s potential interest in acquiring Warner Bros. Discovery amid industry speculation. These developments come as Netflix continues to navigate a competitive streaming landscape while exploring new revenue opportunities.
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