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Buy Netflix, Inc. (NFLX) Stock and Subscribe to Gains

InvestorPlace - Stock Market News, Stock Advice & Trading Tips

Much like its high-growth peers in the FANG group, Netflix, Inc. (NASDAQ: NFLX ) stock has cooled off some recently after a scorching-hot run earlier this year. NFLX stock is off its 52-week highs of $166.87, but remains up 27% year-to-date.

Vivian D Nguyen via Flickr (Modified)


With second-quarter earnings due on July 17, investors are starting to ask themselves: is NFLX stock a buy here?

I think so. Here's why.

Analysts Debate Netflix Ahead of Q2 Earnings

Analysts have started to chime in on NFLX stock ahead of its Q2 report, and they don't all agree.

UBS thinks Wall Street is underestimating Netflix's user growth potential over the next several quarters. While the Street believes poor Q3 sub growth will spill into poor Q4 sub growth, UBS thinks that a strong Q4 content slate will re-invigorate sub growth in both Q3 and Q4. Overall, UBS sees upside to subscription addition estimates for 2017.

Meanwhile, Morgan Stanley notes that there is a positive correlation between how much content Netflix offers in a region and how many viewers Netflix has in that region. Morgan Stanley argues, then, that as newer markets get more and more content, subscription growth in those newer markets will accelerate. Overall...