BUZZ-Netflix stock price rises; Deutsche Bank turns bullish based on valuation

September 29 - ** On Tuesday, Netflix (NFLX.O) shares rose 2.1% to $70.70 after Deutsche Bank raised its rating from “Hold” to “Buy,” stating that a lower valuation underestimates its growth prospects.

** The broker lowered its price target by $5 to $95; compared to the stock's recent closing price, this still implies about 37% upside potential.

** Deutsche Bank analyst Bryan Kraft said the stock is currently trading at 18 times his 2027 EPS estimate, whereas the forward P/E was about 40 times when the share price peaked in June 2025.

** “Given the company’s slowing growth outlook, we never thought that around 40 times P/E was justified for Netflix. However, at an 18 times P/E, we think the current (still very solid) growth prospects are undervalued, leaving room for multiple expansion into the low-to-mid 20 times range, and in addition, 2027 EPS will grow by 23%,” Kraft wrote in a research note.

** Kraft said the market’s “excessive focus” on U.S. member viewing time on Netflix overlooks the company’s broader potential market size and the “healthier” international user engagement trends, adding that in each of the past four half-year periods, international member viewing time increased year over year.

** He also cited NFLX’s competitive advantage in international content production, saying that currently over 60% of content is produced outside the U.S., which he believes will help NFLX maintain its global leadership.

** Additionally, Kraft considers artificial intelligence to be “more friend than foe” for Netflix. He noted that as a company driven by technology since its inception, Netflix is able to leverage AI in multiple ways—and more efficiently than rival entertainment streaming platforms—including applications in content production, personalized recommendations, and advertising.

** Despite gains in this session, the stock is down about 25% for the year, including a decline of around 13% this month.

** According to LSEG data, the average rating from 51 analysts is “Buy”; the median price target is $94.50, down from $115 three months ago.

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