CFRA Reiterates Buy Opinion On Shares Of Netflix, Inc.

We lift our target to $725 from $640 on a forward TEV/EBITDA of 26.3x our 2025 EBITDA estimate at $28.14/share, a premium to the peer average at 23.0x and below NFLX’s three-year average at 31.6x. We keep our EPS views at $18.55 (consensus $18.31) in 2024 and $21.95 ($22.02) in 2025; our respective revenue estimates are $38.6B and $43.2B. Back in mid-April, NFLX surprised investors by disclosing it will remove subscriber data starting in Q1 2025, as it says the business is broader with other revenue streams. We still believe investors and advertisers want to know the subscriber base, net adds, and average revenue per user or subscriber (ARPU) by total/regions. In Q1 2024, NFLX added 9.33M net subscribers, ending with 269.6M total subscribers. Monthly ARPU varied by region with UCAN at $17.30 ($16.18 a year ago), EMEA at $10.92 ($10.89), LATAM at $8.29 ($8.60), and APAC ex-China at $7.35 ($8.03). NFLX is expanding live sports and has a three-year deal with the NFL to stream a Christmas game starting in 2024.

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