Netflix stock rises as Goldman stays bullish, but cuts price target below Street average

Netflix stock rises as Goldman stays bullish, but cuts price target below Street average


Shares of Netflix Inc.












NFLX, +2.70%










surged 1.4% in morning trading Thursday, after Goldman Sachs analyst Heath Terry reiterated his bullish stance ahead of the streaming video giant’s third-quarter results due out next week, but slashed his price target to below the Wall Street average. While Terry expects Netflix to report results “roughly in-line” with guidance of 7 million net subscriber additions, he said data showing that app downloads have been declining suggest a “modest risk” to the downside. He reiterated the buy rating he’s had on the stock for at least the past three years, but cut his price target to $360 from $420, citing reduced earnings expectations and valuation contraction among internet names. The average target of the 40 analysts surveyed by FactSet is $384.97. Terry cut his 2019 EPS estimate to $3.17 from $3.24. He remains bullish, he said, because he believes the impact of a strong fourth-quarter content slate and a more stable pricing environment will boost fourth-quarter subscriber growth above current Street expectations. Separately, UBS analyst Eric Sheridan maintained his buy rating but cut his price target to $370 from $420. The stock has tumbled 28.8% over the past three months, amid concerns over intensifying competition, while the S&P 500












SPX, +0.56%










has slipped 2.3%.

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