Netflix (NASDAQ: NFLX) shares are rising premarket Friday after the company's shares were upgraded at Wells Fargo and had its price target raised at Cowen.
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Netflix shares are up over 2%, trading just under the $318 mark. Still, the stock is down more than 48% in 2022.
Wells Fargo analyst Steven Cahall upgraded Netflix to Overweight from Equal Weight, raising the firm's price target on the stock to $400 from $300 per share.
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The analyst said a positive catalyst path in 2023, with stable subscribers and lower churn, creates “more ways to win” for Netflix. In addition, noting the company's tough 2022, the analyst said that with competition rising and slowing content growth, “the pieces were there for tougher NFLX performance in 2022.”
However, he sees scope for key performance indicators to outperform in 2023, with Netflix's content “clearly improving” and the post-pandemic headwinds now mostly digested, with global connectivity “still providing a long-term tailwind.” Cahall sees Netflix's churn improving in 2023.
Meanwhile, Cowen analyst John Blackledge raised the firm's price target on Netflix to $405 from $340, keeping an Outperform rating on the stock. Blackledge named Netflix as his top 2023 large-cap pick, citing new monetization levers, such as the new lower price ad tier that could drive accelerating net member additions. He also pointed to the paid sharing solution launching globally and expectations for revenue growth re-accelerating in the second half.
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