Netflix’s (NFLX) Q4 results and projections for 2024 indicate the entertainment and streaming company is “outperforming our more bullish expectations,” Morgan Stanley said Wednesday in a report.
The company added 13.1 million new subscribers in Q4, showcasing a healthy growth runway Morgan Stanley said.
Morgan Stanley expects Netflix to increase its free cash flow by 60% from 2024 to 2026.
The company will continue to benefit from net additions from paid sharing in the next few quarters, and in the long term, paid sharing will expand Netflix’s total addressable market by 20%, the report said.
Advertising and gaming revenue probably won’t contribute much to growth in 2024, Morgan Stanley said.
Morgan Stanley raised Netflix’s share price target to $600 from $550 and reiterated the stock’s overweight rating.
Netflix shares jumped 12% in recent Wednesday trading.