TLDR
- Netflix stock has fallen ~13% over five trading sessions following weaker-than-expected Q2 guidance
- Wolfe Research reiterated an Outperform rating with a $107 price target, citing strong engagement trends
- Co-founder Reed Hastings is set to leave the board when his term expires in June
- Non-English content made up ~68% of 2025 engagement, down from 70-71% in 2023-2024
- Wall Street consensus remains a Strong Buy: 29 Buys, 8 Holds, average price target of $114.96
Netflix stock has had a rough week. NFLX dropped roughly 13% over five trading sessions after the company’s Q1 2026 earnings report left investors cold — not because of what happened, but what’s coming.
Q1 revenue and EBIT came in about 1% above Piper Sandler estimates. But Q2 guidance was the problem. Revenue guidance came in 0.5% below consensus, and operating income guidance missed by 5%. That’s the kind of gap that sends a stock sliding.
On top of that, Reed Hastings — Netflix co-founder and current board chairman — will step down when his term ends in June. The news landed at the same time as the earnings release and added to the pressure.
What Wolfe Research Says
Wolfe Research analyst Peter Supino didn’t flinch. He reiterated a Buy rating and kept his $107 price target in place, pointing to what he calls solid core engagement trends.
Supino addressed the common concern that Netflix is losing viewers to YouTube, Meta, and TikTok head-on. His data suggest Netflix’s engagement is holding up. He describes it as a “highly differentiated product” whose value isn’t just about raw watch time.
He also noted that the average U.S. Netflix subscriber already spends 1.6 hours per day — about one-third of their daily video time — on the platform. That’s a strong base to work from.
Supino believes Netflix can keep raising prices as long as it stays a daily habit for subscribers. He sees room for sustained mid-single-digit subscriber growth if connected TV households keep growing at 70 to 100 million per year and Netflix holds its ~30% penetration of those homes.
Engagement Trends Worth Watching
Non-English content accounted for 68% of total engagement in 2025, down from 70-71% in 2023-2024. That 2-3 percentage point shift equals roughly 4 to 6 billion viewing hours moving toward English-language programming.
International engagement per subscriber fell high single digits in 2025, compared to low single-digit declines in the U.S. Wolfe links part of this to Netflix’s expansion into markets like Japan, where average TV viewing is about 50% lower than in the U.S.
It’s a real headwind, but Supino frames it as a math issue, not a product issue. Netflix is simply adding more subscribers in lower-consumption markets.
The stock currently trades around $92.58. With a PEG ratio of 0.64, InvestingPro flagged it as undervalued relative to near-term earnings growth. Revenue growth over the last twelve months sits at 16.7%.
Other analysts have adjusted targets post-earnings. Piper Sandler raised its target to $115 from $103. KeyBanc held at $115. Bernstein trimmed from $115 to $110. Guggenheim cut from $130 to $120. TD Cowen held at $112. All maintained positive ratings.
Wall Street’s current consensus: 29 Buys, 8 Holds, average price target of $114.96 — implying about 24% upside from current levels.
🚨 Our April Stock Picks Are Live!
A new month means new opportunities. Our analysts have just released their top stock picks for April, highlighting companies with strong momentum that rank highly on our KO Score algorithm. We’re also now sharing trade ideas for both long-term and short-term investors, giving you more ways to spot potential opportunities in the market.
Sign up to Knockout Stocks today and get 50% off to unlock the full list and see which stocks made the cut.
Use coupon code Special50 for your exclusive discount!
Get 3 Free Stock Ebooks
Discover top-performing stocks in AI, Crypto, and Technology with expert analysis.
- Top 10 AI Stocks - Leading AI companies
- Top 10 Crypto Stocks - Blockchain leaders
- Top 10 Tech Stocks - Tech giants
