This post was originally published on this site
https://i-invdn-com.investing.com/news/LYNXMPEA8I14D_M.jpg
BofA analysts told investors that Netflix, which is rated at Buy with a $490 price target, is “poised to outperform.”
They listed four main drivers, including a crackdown on password sharing, the introduction of a value-oriented, ad-supported tier that expands its total addressable market and monetization, an inflection point in free cash flow, and a significant subscriber runway due to the ongoing shift from linear to streaming.
“Netflix’s introduction of an ad-supported tier provides significant potential operating and financial upside,” they wrote.
On Disney — which the firm has assigned a Buy rating and $135 price target — the analysts said it had underperformed the S&P by over 40% since November 2021, but they believe it is set to outperform in Q3.
According to the analysts, the potential rise is due to recent price increases across Disney+/Hulu/ESPN+, strong advertiser demand for the recently launched ad-supported tier on Disney+, cost discipline across the DTC business, and the continued robust theme park demand with several levers for future growth.
