Investing.com– Seaport upgraded its rating on Netflix Inc (NASDAQ: ) on Wednesday, citing expectations for stronger subscriber growth as the streaming giant prepares to report its fourth-quarter earnings next week.
Seaport upgraded Netflix to Buy from Neutral, with a $955 price target, representing a 12.5% upside from Wednesday’s close.
The brokerage said it expects a higher-than-expected number of members – to 9 million in the fourth quarter, compared with a previous expectation of 5.7 million.
Seaport also sees Netflix’s original content providing strong tailwinds for the stock, particularly with the release of the second season of the blockbuster Squid Games during the quarter.
The brokerage said advertising growth, more premium content projects and winning live sports rights – such as the Jake Paul vs. Mike Tyson match – heralded a positive quarter.
“NFLX should remain a core holding due to revenue growth, OI margin expansion and FCF conversion,” Seaport analysts wrote in a note.
Netflix will report December quarter earnings on January 21st. The company is expected to post earnings per share of $4.2 on revenue of $10.13 billion.
