A Netflix Inc (NASDAQ:NFLX) analyst is upgrading the rating on the streaming stock after the company chose not to raise its bid for Warner Bros. Discovery (NASDAQ:WBD) and is putting capital to use elsewhere.
• What’s next for NFLX stock?
The Netflix Analyst
JPMorgan analyst Doug Anmuth upgrades Netflix stock from Neutral to Overweight with a price target of $120. The analyst previously withdrew the rating with JPMorgan part of the financing team on the proposed merger. JPMorgan previously downgraded Netflix shares from Overweight to Neutral back in May with a price target of $124.
The Netflix Analyst Takeaways
Anmuth declares things are "back to business" for Netflix as the streamer walks away from its proposed merger with Warner Bros.
"We believe NFLX remains a healthy organic growth story, driven by a combination of strong content, global subscriber growth, continued pricing power and an early-stage/under-monetized ad tier," Anmuth said in a new investor note.
The analyst sees Netflix maintaining strong operating margins and free cash flow going forward, which should help with the resumption of share repurchases after walking away from Warner Bros.
Anmuth said artificial intelligence could improve content discovery and personalization for Netflix, along with the potential for better advertising and to improve content production costs.
"We believe storytelling and talent will remain critical moats, ultimately better insulating NFLX from AI disruption risk compared to transactional business models."
The analyst said a strong content slate for Netflix in 2026 could help the company re-accelerate its engagement after viewing hours were up 1% in the first half of 2025 and up 2% in the second half of 2025 on a year-over-year basis. Viewing hours for originals were up 9% year-over-year in the second half of 2025.
Anmuth also said Netflix could raise prices in the U.S. in the middle or second half of 2026.
The analyst also predicts that Netflix will have greater scale for its Live content and could acquire additional National Football League game rights.
"We believe NFLX's scale and streaming leadership position, three-year growth of double digits for revenue and 20%+ for operating income/GAAP EPS/FCF, and a well-insulated subscription-based model all support a premium valuation."
Netflix Stock Price Action
Netflix stock is up 0.67% to $96.88 on Monday versus a 52-week trading range of $75.01 to $134.12. Netflix shares are up 3.34% year-to-date in 2026.
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