Netflix, Inc (NASDAQ:NFLX) reached an all-time high at $122.79 per share today after Guggenheim Securities initiated coverage on the stock with a bullish recommendation.
The shares of the online video streaming company closed $121.15 per share, up by 7.63%. Netflix gained more than 148% year-to-date, and the stock is among the top performers in the S&P 500 index.
Analyst’s rating on Netflix
Guggenheim analyst Michael Morris issued a Buy rating on the shares of Netflix with a 12-month price target of $160.His recommendation showed that he has a great confidence on the company’s profitability in the future.
In a note to investors, Morris wrote, “Netflix is based on a sound concept: Utilize improvements in technology to better entertain consumers in an efficient manner at an attractive price. The stock’s performance has been very strong over the past two years, yet at $48 billion in market capitalization, we still see a significant gap between equity value and ultimate intrinsic value of the service.”
Morris believed that Netflix will continue to increase the number of its subscribers at a steady rate as it expands its service internationally.
Data compiled by Bloomberg showed that Morris’ price target is the highest compared with the estimates of 46 analysts covering Netflix. The average 12-month price target on the stock was $114.46 per share.
John Blackledge, an analyst at Cowen & Co has a price target of $150 per share. He is known as the most accurate forecasted of Netflix shares.
Netflix financial performance
Last month, Netflix reported earnings of $0.06 per share on $1.64 billion in revenue in the second quarter. The company beat the $0.05 in earnings per share on $1.60 billion in revenue expected by Wall Street analysts.
The company gained additional 3.3 million subscribers including 0.9 million in the United States and 2.4 million overseas. Netflix believed that its strong subscriber growth was driven by its slate of original programs.
The online video streaming company has been attracting the creative community in Hollywood because of its growth and desire to invest in the production of new movies and TV shows.
Last month, Netflix announced that Angelina Jolie will direct and produce a Netflix Original Film—First They Killed My Father: A Daughter of Cambodia Remembers, an adaptation of the harrowing and poignant memoir of Loung Ung, a Cambodian author and human rights activist.
In a statement, Jolie said, “I was deeply affected by Loung‘s book. It deepened forever my understanding of how children experience war and affected by the emotional memory of it.”