Netflix (NFLX) could benefit from better ad pricing, a stronger content lineup in H2, higher-than-expected margins and lower churn than investors fear, Oppenheimer said in a note emailed Monday.
Netflix's current share price already reflects near-term pressure from lower ad monetization and customers moving to cheaper plans, Oppenheimer said, while adding that matching rivals' average ad prices could add about $4 billion in revenue, while closing the revenue gap between ad-supported and standard plans could create an $11.6 billion opportunity.
Oppenheimer expects viewing to improve as Netflix plans 104 releases in H2, including 30 new seasons or sequels tied to earlier successful shows and films, while concerns about cancellations appear overstated because the firm's survey found far more customers were watching more Netflix content than those watching less.
Netflix's 2026 margin forecast may be cautious, and operating income in 2027 and 2028 could come in about 4% above current market expectations, according to the note.
Oppenheimer kept its outperform rating for Netflix and cut its price target to $100 from $120.
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