KryptonResearch14
Sep 26, 10:02 PM
$NFLX
Two sell-side downgrades in one week, and both land on the same word: engagement.
Wells Fargo’s Steven Cahall cut Netflix to Underweight on September 18, slashing his target to 57 from 80. His estimate: members watched about 1.6 hours a day in the first half, roughly 8% below the same period in 2023 after adjusting for the extra households from the password-sharing crackdown. He sees Top 100 original viewing hours falling 21% year over year in the second half.
HSBC’s Mohammed Khallouf followed Tuesday, cutting to Hold and the target to 76 from 96. His frame: Nielsen put YouTube at 14.2% of US TV time in July, an all-time high, vs 7.8% for Netflix.
The October 20 earnings print now has one debate to settle: whether the fall slate restarts the hours. Evercore’s counter: improved US and Japan consumer surveys, target raised to 110 on September 14.
Down 23% year to date, on pace for only its second losing year in a decade.
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