Netflix rises as Loop Capital upgrades on valuation, improving fundamentals
Marvin Samuel Tolentino Pineda/iStock Editorial via Getty Images
Netflix (NASDAQ:NFLX) shares rose around 0.5% in pre-market trading on Friday as investment firm Loop Capital upgraded the media and entertainment giant's stock, citing valuation and improving fundamentals.
Analyst Alan Gould raised his rating on Netflix (NFLX) shares to buy from hold and boosted his price target to $500 from $425, noting that competitors are raising prices and cutting their content spending, which should help the Los Gatos, California-based company.
Gould also said that Netflix (NFLX) is the "best positioned" media company to deal with the writer and actor strikes due to its "larger pipeline of unreleased content and global production capabilities."
Members of the writers guild have been on strike for more than 100 days already, an event that has cost the California economy more than $2B in losses, according to the Milken Institute.
The Screen Actors Guild â American Federation of Television and Radio Artists, or SAG-AFTRA, is also on strike, with that walk-out having recently surpassed 30 days length.
Additionally, Gould believes that the strike will accelerate the decline of the traditional TV business and benefit streaming, and thus Netflix, especially considering the company's paid-sharing initiatives have gone "better than expected" and the expected boost from advertising over time.
Analysts are largely cautious on Netflix (NFLX). It has a HOLD rating from Seeking Alpha authors, while Wall Street analysts rate it a BUY. Conversely, Seeking Alpha's quant system, which consistently beats the market, rates NFLX a HOLD.

More on Netflix

Netflix: A Bullish Trifecta Makes It A Buy
Turning Off Netflix
Netflix And The Incredible AI Possibilities
Netflix builds gains as report shows subscriber momentum rolls on
Disney, Amazon, Netflix called 'new gatekeepers' of media, WGA says
Streaming hits new top share of TV usage, while linear viewing finds new low