Shares of Netflix, Inc. (NASDAQ:NFLX) have remained strong since it declared its plans to enter China. The stock is just 1.17% down from its all-time high price of $631.4. Netflix shares posted returns of over 50.5% in just the last eight weeks. Despite this strong rally of the firm’s shares, analyst see the stock’s potential as being up to 44% higher.
Netflix’s New Platform
Netflix is seeking to upgrade the look and feel of its website and will launch a new user interface in June. The firm is already testing this upgraded version among certain groups of users. Mike Snider from USA Today is among the users who are testing the new website. He says that the upgraded website offers a classy touch with quality features. Snider made note of some changes in the new website including a black background and a better Menu.
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If the cursor is positioned over a movie or a TV program, the icon expands to a large window to give more data like production date, MPAA rating and synopsis. The large window will also display a Play arrow and add to list icon in the middle of the image. The firm has updated its site after four years as management hopes to improve the experience for its users across the world.
Analysts Positive Sentiment on Netflix
Even though shares of Netflix have posted a year to date return of over 81.8%, the positive stance among analysts continues. Recently, Jeffrey Wlodarczak from Pivotal Research Group raised the price target to $850 per share from $200. Jeffrey sees a lot of room for the firm to grow and projects over 160 million customers across the world by 2021. He estimates 13.5 million subscribers by 2021 from the potential Chinese partner. South Korea might add another 2.5 million users.
Mark Mahaney, analyst from RBC Capital analyst also raised the target price to $700 from $600.00, driven by U.S, France and Germany survey results as well as the firm’s proprietary “Original Content Tracking”. Mark also views the firm’s potential China market opportunity as a value adder.
As per the RBC Capital’s 15th quarterly 1,000+ U.S. Survey Highlights, Netflix is the leading U.S. Online Video site, with 72% of present Netflix subscribers being extremely satisfied with the website. The churn rate of the site is also very low, as 73% of the present subscribers do not plan to cancel subscriptions in the near future, based on the survey results. The French & German surveys showed that there is lot of room for the site to grow in Europe. The site’s usage in France and Germany rose 7% and 11% respectively, among the surveyed respondents.