Netflix: Buy Rating Maintained as Valuation Reset and Strategic Expansion Offset Near-Term Margin Pressure

Peter Supino, an analyst from Wolfe Research, maintained the Buy rating on Netflix. The associated price target was lowered to $95.00.

Peter Supino has given his Buy rating due to a combination of factors that, in his view, support Netflix’s long-term value despite near‑term earnings pressure. He acknowledges that management’s 2026 guidance for about 13% revenue growth comes with higher‑than‑expected content and operating costs, which push down incremental margins and require cuts to his 2026–2027 EPS forecasts and price target. However, he emphasizes that investors had been overly optimistic about expense trends, and the reset in expectations, along with a pullback in the stock’s valuation to roughly 27x his updated forward earnings estimate, creates a more attractive entry point.

Supino argues that Netflix’s strategic choice to lean into its scale advantages—through the proposed Warner acquisition and increased spending on content and advertising technology—should solidify its category leadership and extend its growth runway. With Netflix still holding less than 10% of global TV viewing and under 15% share of U.S. TV revenue, he believes the company can sustain double‑digit percentage growth for years, even if investors must tolerate elevated spending and integration risk in the near term. His reduced year‑end 2026 price target of $95, based on a more conservative multiple and lower EPS forecast, still implies meaningful upside from current levels, leading him to maintain a Buy recommendation for patient shareholders.

In another report released today, Canaccord Genuity also maintained a Buy rating on the stock with a $125.00 price target.

Based on the recent corporate insider activity of 171 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of NFLX in relation to earlier this year.