Netflix stock is taking a victory lap after winning the streaming video war. Shares of the internet television network are trading near record high territory.
On March 17, equity research firm MoffettNathanson upgraded Netflix stock to buy from neutral, citing its runway for growth and improved profitability.
"Despite all of Netflix's recent success in reinvigorating growth, we believe its engagement will allow the company to better monetize and unlock greater profits in the years ahead," MoffettNathanson analyst Robert Fishman said in a client note.
Netflix's advertising-supported service tier will be a revenue driver for the company, he said. Fishman increased his price target on Netflix stock to 1,100 from 850.
Netflix stock ended regular-session trading Tuesday at 997.28. It hit an all-time high of 1,064.50 on Feb. 14 after its fourth-quarter earnings report, where it beat estimates for subscribers, revenue and earnings.
Netflix Stock Fundamental Analysis
On Jan. 21, Netflix topped Q4 estimates and guided above views for the full year ahead. Netflix stock rocketed after the report.
The Los Gatos, Calif.-based company earned $4.27 a share, up 102% year over year, on sales of $10.25 billion, up 16%, in the December quarter. Analysts polled by FactSet had expected earnings of $4.21 a share on sales of $10.11 billion.
For 2025, Netflix is forecasting revenue growth of 13% to $44 billion, based on the midpoint of its guidance. Analysts were looking for $43.6 billion.
Netflix added 18.91 million subscribers in Q4, ending 2024 with 301.63 million subscribers worldwide. Wall Street had modeled for 10.18 million net new subscribers.
However, Netflix will become less transparent this year. Starting with the first quarter of 2025, Netflix will stop reporting quarterly subscriber numbers. The company wants Wall Street to focus on revenue and operating margin instead.
Netflix plans to report its Q1 results on April 17.
Netflix Stock Technical Analysis
On Jan. 22, Netflix stock broke out of a flat base with a buy point of 941.75, according to IBD MarketSurge charts.
More than two dozen Wall Street analysts raised their price targets or ratings on Netflix stock after the company's winning fourth-quarter report.
Netflix ranks first out of 20 stocks in IBD's Leisure-Movies & Related industry group, according to IBD Stock Checkup. It has a best-possible IBD Composite Rating of 99. IBD's Composite Rating combines five separate proprietary ratings into one easy-to-use rating. The best growth stocks have a Composite Rating of 90 or better.
Netflix stock has an IBD Relative Strength Rating of 94 out of 99. The rating shows how a stock's price performance stacks up against all other stocks over the last 52 weeks.
Further, it has an IBD Accumulation/Distribution Rating of B+, meaning institutional investors are buying.
Is Netflix Stock A Buy Right Now?
No, Netflix stock is not a buy right now. It is extended beyond the 5% chase zone of its recent breakout.
NFLX stock will need to form a new base in the right market conditions before setting another potential buy point. Check out IBD's Big Picture column for the current market direction.
To find the best stocks to buy or watch, check out IBD Stock Lists as well as IBD's Leaderboard, MarketSurge and SwingTrader platforms.
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