Netflix (NASDAQ:NFLX) Slips, Now the New Home of Sesame Street

Streaming giant Netflix (NFLX) just made a move that will secure its position in the annals of television history, at least for a while. After federal budget cuts ravaged the entire notion of PBS, Netflix stepped in to offer one of its biggest and longest-running properties a slot. Now, Netflix will air, along with PBS, episodes of beloved children’s classic Sesame Street. The news did little for investors, though, who sent shares down fractionally in Monday afternoon’s trading.

Sesame Street is about to kick off its 56^th season on the air, and will air simultaneously on Netflix and PBS as part of a “public-private partnership” deal, reports note. Along with the new episodes will come a healthy backlog of 90 hours of earlier releases, which is a scant fraction of the show’s overall body of work. Scant indeed; reports suggest that there is over 1,125 hours of Sesame Street in existence, of which we will not get back even a percentage measurable in whole numbers.

The previous home of Sesame Street, Warner Bros. Discovery’s (WBD) Max service, noted that it was stepping back from giving Big Bird et al a home on the platform. Warner had been hosting the show on HBO since 2016, moving it to Max in 2020.

Embracing AI

Meanwhile, reports note, Netflix is also leaning into generative artificial intelligence (GenAI) for its ad-making duties. Word from the Netflix upfront event—because of course Netflix has an upfront—is that Netflix will use AI-generated ads for its midroll ads—the ads that hit in the middle of a show—or for whenever a viewer hits the “pause” button on a stream.

While this move was met with some controversy, Netflix itself—via president of advertising Amy Reinhard—declared that “the foundation of our ads business is in place.” Further, Reinhard declared, “…the pace of progress is going to be even faster.” Thus, the days of binge-watching on the platform without interruption may be all but gone at Netflix as it finds more and more ways to profitably interrupt the service you already pay for.

Is Netflix Stock a Good Buy Right Now?

Turning to Wall Street, analysts have a Moderate Buy consensus rating on NFLX stock based on 29 Buys and 10 Holds assigned in the past three months, as indicated by the graphic below. After a 85.94% rally in its share price over the past year, the average NFLX price target of $1,189 per share implies 0.21% upside potential.

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