Patience may turn out to be a virtue for Netflix (NFLX - Get Report) investors.

Despite two consecutive lackluster quarters that have hurt its stock price, the video streaming giant may have more long-term upside than the market is currently giving it credit for.

The Los Gatos, Calif., company has seen its stock drop over 15% year-to-date largely due to misses on subscriber growth and revenues. Netflix has also been grappling with elevated churn levels stemming from its recent price hikes of $1 to $2 per month.

Netflix shares were trading up about 0.5% Thursday early afternoon to $97.53.

Netflix has been testing the patience of its investor base, but there are plenty of reasons to be optimistic about the company's profitability potential largely thanks to subscriber and viewership trends.

"Netflix leads every content competitor in terms of subscriber growth and probably overall viewership engagement with nearly 2 hours per day of viewership per sub," RBC Capital Markets analyst Steve Cahall wrote in a note on Thursday. "Netflix's revenue and Ebitda per sub is also amongst the best of any platform."

Cahall argued that evaluating content leadership is much more complex than simply looking at the subscriber growth numbers that investors tend to focus on. Viewer engagement metrics such as minutes of viewership, as well as a company's overall pricing power, also need to be considered, according to Cahall. 

"Given the 70mm-90mm U.S. household footprint of most key media networks, there may still be substantial upside from the 47mm U.S. streaming subs NFLX reported in the June quarter," he wrote.

While Netflix doesn't currently generate advertising or syndication revenue fees, as the more traditional media networks produce, it has much greater user engagement, with nearly two hours per day of average viewership per sub. Measured this way, Netflix leads all other media platforms and it has the ability to further monetize its usage, Cahall argued. 

He acknowledged that subscriber growth is slowing for Netflix, but noted that its numbers are still better than most media networks, many of which are anticipating annual subscriber declines in the 1% to 2% range due to cord cutting.

From 2013 to 2015, Netflix experienced 17% compound annualized growth in its number of domestic subscribers. By comparison, Viacom (VIAB - Get Report) and Walt Disney (DIS - Get Report)  both had a 1.8% annualized decline over the same time period. Media companies with premium cable networks such as CBS (CBS - Get Report)  (Showtime) and Time Warner (TWX)  (HBO) were the best performers among the traditional media group. 

Still, Cahall did acknowledge that Netflix lags other media networks in terms of monetization, wondering whether the traditional media business model that relies on advertising and live sports is structurally more profitable.

But he still argued that "Netflix's growth profitability potential is substantial and under-appreciated by investors."