The firm said its sum-of-the-parts analysis supports a $122 value for Netflix, boosting Piper's confidence that the shares are undervalued by 25%, the Fly reports.
The Los Gatos, CA-based company has experienced some obstacles on its path toward becoming the dominant global source for streaming content, but its long-term trajectory continues to be in a positive direction, according to Piper.
The firm believes concerns of domestic saturation, near-term impact from un-grandfathering of fees, competition and slower ramp of international subscribers are reasonably reflected in Piper's estimates when balanced out by the positives of long-term international growth potential, the Fly noted.
Piper maintained an "overweight" rating and $122 price target on the stock.
Separately, TheStreet Ratings Team has a "Hold" rating with a score of C+ on the stock.
The primary factors that have impacted the rating are mixed. The company's strengths can be seen in multiple areas, such as its robust revenue growth, expanding profit margins and largely solid financial position with reasonable debt levels by most measures.
But the team also finds weaknesses including a generally disappointing performance in the stock itself, disappointing return on equity and premium valuation.
Recently, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.
You can view the full analysis from the report here: NFLX