Netflix got a vote of confidence from MoffettNathanson analysts, which upgraded estimates on potential U.S. price hikes and ad growth.
Netflix shares experienced a notable increase following an optimistic upgrade from analyst Jason Helfstein at Oppenheimer, who raised his price target to $450 from $415. This upgrade was driven by expectations of future price hikes in the U.S. and a robust outlook for advertising revenue growth. Helfstein highlighted Netflix's potential to implement price increases in the U.S. in 2024, following similar moves in Canada, and projected a significant rise in ad-supported revenue, estimating it could reach $2.3 billion in 2024 and $4.2 billion in 2025. He also noted that Netflix's ad-supported tier, launched in November 2022, has been performing well, with ad-supported memberships growing by 70% quarter-over-quarter. This positive outlook contributed to Netflix's stock rising by 2.6% to $438.84 in premarket trading.