Netflix price forecast: BofA Securities sees a 45% upside

Shares of Netflix Inc (NASDAQ: NFLX) have tanked more than 25% in two months, but Bank of America Securities says the stockholders are in for a treat in the coming months.

Schindler explains why he’s bullish on NFLX

BofA’s Nat Schindler reiterated his “buy” rating on Netflix this morning with a price target of $750 that represents a 45% upside from here. On CNBC’s “The Exchange”, the senior analyst said:

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I believe in Netflix at this point, and I believe subscribers follow content. The content rollout has been very big in Q4, and it’ll be even bigger in Q1 and Q2. And that should drive more people to keep watching Netflix.

Schindler forecasts a little under 30 million net new subscribers for the streaming giant this year. In its latest reported quarter, Netflix beat on new subscribers by more than half a million. The California-based company is set to report its Q4 results later this week.  

Competition isn’t a threat for Netflix

Netflix has raised its prices significantly in recent months, yet, Schindler doesn’t see the likes of HBO Max as much of a competitive threat for Netflix. He said:

I don’t really believe in competition here. The reason being, people don’t watch channels anymore. They watch shows. If you want to watch Strange Things, HBO Max won’t help you. The amount of content on Netflix versus on Disney or HBO Max, it’s not even close. 

According to the BofA Securities’ analyst, subscribers might switch to rivals like HBO Max from time to time, but retention will be a problem for other streaming companies since Netflix is offering so much more at pretty much the same price.

Netflix is also set to debut in gaming that Schindler sees as another possible catalyst for the stock.