Netflix Inc. (NASDAQ: NFLX) is proving the point that perhaps investors should pay attention when price targets and ratings get raised by many analysts in a short period of time right before their earnings reports. Any analyst can issue a target after a report (most do), but sticking their necks out right before earnings or key news comes with reputational risks.
After Netflix beat earnings and subscriber expectations, its shares were last seen up almost 10% at $756.25 on Friday’s mid-day trading. Oggonomics had already shown all the firms raising ratings or price targets and now we are seeing even more firms issue additional upside.
Oggonomics featured Netflix in the 12 MOST UPGRADED STOCKS HEADING INTO EARNINGS SEASON. That said, Oggonomics always reminds investors and its readers that no single analyst report should ever be the sole basis to buy or sell a stock. That also holds true even if there are 12 or more calls.
Now there is the other side of the coin — when a whole wave of upgrades stands out like an analyst upgrade brigade. The ultimate decision to buy or sell, or hold or short sell, is up to each investor and is a decision which should be made with a financial advisor.
There are more than a dozen firms with their analysts reiterating their ratings and raising their price targets on October 18 (or the night before) that are encompassing the post-earnings reporting and price action. These were the ones tracked (listed alphabetically):
- Bernstein (Market Perform) target to $780 from $625
- BMO (Outperform) target to $825 from $770
- Canaccord Genuity (Hold) target to $760 from $750
- Jefferies target to $800 from $780
- JPMorgan (Overweight) target to $850 from $750
- KeyBanc (Overweight) target to $785 from $760
- Morgan Stanley (Overweight) target to $830 from $820
- Needham (Buy) target to $800 from $700
- Oppenheimer (Outperform) target to $825 from $775
- Piper Sandler (Overweight) target to $840 from $800
- TD Cowen (Buy) target to $835 from $820
- UBS (Buy) target to $825 from $750
- Wedbush (Overweight) target to $775 from $725
- Wells Fargo (Overweight) target to $795 from $758
Benchmark is one of the few “Sell” ratings out there on Netflix, but they did slightly raise their price target to $555 from $545.
Netflix’s shares had peaked at around $730 the week before earnings. Its stock was also up about 50% YTD. Barclays was the standout form which issued a downgraded on Netflix ahead of earnings, down to Underweight from Equal Weight but keeping its $550 price target in place on 10/7.
Here were the many analyst calls jumping on the Netflix bandwagon with higher target prices or strong price targets (listed by date) ahead of its earnings report:
- Guggenheim (Buy) target to $810 from $735 (10/11)
- Oppenheimer (Outperform) target to $775 from $725 (10/10)
- Morgan Stanley (Overweight) target to $820 from $780 (10/10)
- Deutsche Bank (Hold) target to $650 from $590 (10/9)
- JPMorgan (Overweight) reiterated $750 target) (10/8)
- TD Cowen (Buy) target to $820 from $775 (10/7)
- Piper Sandler raised to Overweight and $800 target (from Neutral, $650) (10/7)
- KeyBanc (Overweight) target to $760 from $735 (10/1)
- Pivotal Research (Buy) target to $900 from $800 (8/30)
