MKM Partners Rob Sanderson Says Netflix, Inc. (NFLX) Will Report Positive Results

Netflix, Inc. (NASDAQ:NFLX) rallied on Monday post the upgrade it received from UBS. UBS upgraded Netflix, Inc. (NASDAQ:NFLX) stock from a ‘Neutral’ rating to a ‘Buy’ rating and increased the price target from $370 to $565; more than a 50% revision. This boosted Netflix, Inc. (NASDAQ:NFLX) stock on Monday by more than 4%. Netflix, Inc. (NASDAQ:NFLX) is all set to report its earnings on Wednesday. Meanwhile, MKM Partners Managing Director, Rob Sanderson talked on CNBC about Netflix, Inc. (NASDAQ:NFLX)’s global and local opportunities.

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Sanderson feels that global opportunities for Netflix are considerably larger than domestic opportunities in US. But he feels that Netflix is still growing in US and he thinks that there is still a bit of headroom for Netflix to grow in US.

He said if many people decide to cut the chords Netflix becomes a must buy option for them. He feels that the contents that Netflix has in over the top category cannot be matched by anyone else. MKM Partners has a ‘Buy’ rating for Netflix with a price target of %530.

Netflix has grows significantly so far in 2015 with stock prices going up by more than 35% YTD and the company will be reporting its quarter earnings on Wednesday. What can we expect out of this earnings and what will be the after effect on the stock?

“I think the expectation on the quarter is clearly rising with the stock price. I think the domestic market has to be atleast in line and the international subscriber element has to be above expectations by probably 200,000 or so, that is my guess. Its hard to really benchmark the expectations till we see the print. I think that’s reasonable. The momentum seems to be there,” Sanderson said.

Sanderson feels that Netflix has the momentum with them since the beginning of this year and he pointed at their report saying that Netflix has streamed close to 10 billion hours of contents in the first quarter alone, which is huge. He said that this number is up by more than 70% YoY.

He feels that these numbers shows people’s engagement in Netflix’s contents, which he thinks is a positive for the company in long term.

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