Loop Capital analysts downgraded Netflix (NASDAQ:NFLX) from Buy to Hold, raising their price target to $950 from $800 on the stock. The shift reflected a view that much of the bullish thesis underpinning Netflix’s growth potential had already been priced into the stock.
The analysts had upgraded Netflix nearly 16 months ago, citing a favorable competitive landscape as rivals raised prices and cut spending, a strong content pipeline bolstered by global production ahead of industry strikes, the successful rollout of paid sharing, and optimism around its advertising business. These factors had significantly strengthened Netflix’s competitive position.
However, with the stock now nearing what the analysts considered fair value, they see limited room for additional upside in the near term. As the key drivers of Netflix’s recent success have become widely acknowledged, the analysts shifted to a more cautious stance, downgrading the stock to Hold.