Netflix Worth $85, MoffettNathanson Analyst Says

MoffettNathanson’s Michael Nathanson maintained a Neutral rating for Netflix, Inc. (NASDAQ: NFLX), while reducing the price target from $98 to $85. The company announced “relativity weak” domestic subscriber guidance for Q1. This may indicate that 60 million subscribers “is an upper bound."

Nathanson added that while domestic contribution margins are likely to exceed 40 percent, beating the target, “the shifting of content spending to new markets will depress international margins." The view of the stock has turned from being invincible to concerning.

Shares of Netflix recently traded at $86.09, down 4 percent Friday morning.

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Separately on Friday, according to Business Standard, an India-based daily newspaper, said Netflix is "eager" to produce local content in the country after entering the country last month as part of a global expansion to more than 100 countries.

The publication noted that is proving to be "next to impossible" for Netflix to acquire blockbuster films and show for the Indian market. In fact, Netflix's current library has just one major recent hint along with classics from Bollywood.

Business Standard further suggested that Netflix is gathering viewing habits of its Indian viewers and will make future decisions accordingly.