Netflix Inc. Rating Lowered To “Underperform” On Subscriber Base Loss Rumors
The shares of Netflix Inc. had traded at a lower level on Tuesday after the analysts from Needham and Company had cut the rating on this stock and had cautioned on the losses of subscribers for the group that is engaged in online streaming services.
Laura Martin who is an analyst at Needham had lowered her rating for the company to be “Underperform” from what she had done during a prior assessment that is “hold” and it had noted that the stock is an option which is going to be more attractive at a price of $260 per one share. She has also cautioned that the competition intensity is increasing in the space and it could mean the Netflix might be losing its subscriber base by 4 Million subscribers in the United States in the coming year in the tier which is premium priced between $9 per month to $16 per month.
Martin has said that Netflix is in all likelihood going to need to offer a service which is priced lower alongside the product which it sells at a premium price for it to compete with the platforms that have been launched newly from the competitors like Apple, Comcast, Viacom, and Disney, which have all put their products at a net price per month of $5 and $7.
The shares of Netflix had been down by 1.9% in the early trade on Tuesday.
In the previous month, Disney had said that there was an extraordinary amount of demand for its Disney + streaming platform which it had launched recently and said that it aims at having 60–90 Million subscribers in five years from now.
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