NEW YORK ( TheStreet) -- Netflix ( NFLX) is catching up to cable and satellite TV network HBO on brand quality, according to BTIG analyst Richard Greenfield. Greenfield on Monday finally began coverage of Netflix with a "buy" rating and $250 price target after BTIG's media equity research team for years wrote more about Netflix than any other company they were following but had been "scared" to put a rating on the stock given the disconnect between the stock price and underlying fundamentals. But now, Greenfield is seeing marked improvement in the movie provider's underlying value. For instance, the company is moving closer and closer toward possessing the "intangible quality of the brand" that Time Warner's ( TWX) HBO has, and perhaps may even have a competitive edge in this regard, by offering a far more attractive price to subscribers and a wide array of kids programming that HBO does not have. Greenfield also lauds Netflix's critically acclaimed, but underwatched serial dramas such as "Mad Men" and "Breaking Bad" and its launch of original programming. "They are trying to reach a point where consumers know that there will always be something new and interesting coming that requires a Netflix subscription, in addition to top-tier syndicated programming and a sufficient movie selection." "Netflix just works, wherever you are, with an interface that does not require the ability to read, which is critical for children, increasing the Netflix's overall 'stickiness,'" Greenfield added. Netflix looks also to be gaining traction overseas while continuing to make progress in its U.S. streaming business.
"While it is far from clear that Netflix 'wins' outside the U.S., we believe recent international sub trends demonstrate consumer demand exists outside the U.S. and that Netflix is not simply throwing money into a black hole." Overall, Greenfield says his positive coverage initiation on Netflix reflects the strengthening relationship between the stock's price and actual value. Expectations are that subscriber churn rates will drop and additions will rise as customers increasingly move to streaming on Netflix, attracted by more and more high-quality, original programming. The pace by which the company's domestic revenue growth outpaces Netflix's spending on digital content should accelerate in 2014 and beyond, said the analyst. Time Warner Inc. was down 0.94% to $58.90 Monday and Netflix was popping 3.18% to $178.70. Written by Andrea Tse in New York >To contact the writer of this article, click here: Andrea Tse.