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Netflix Stock Hits Another Record After Tyson vs. Paul. Why This Analyst Predicts a 26% Jump
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Massive viewer interest in the fight between Mike Tyson and Jake Paul suggests Netflix’s big bet on live sports will pay off, one bull said on Wednesday.
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Pivotal Research Group analyst Jeffrey Wlodarczak raised his price target for the streaming service’s stock to $1,100, up from $925 previously. The target, which is the highest on the Street, implies shares could climb 26% from their current levels.
Netflix stock climbed 2.9% to hit a fresh all-time high on Tuesday, after the streamer said its broadcast of the fight between Tyson and Paul had drawn in 108 million global viewers.
The shares gained again in morning trading on Wednesday.
Wlodarczak said in a note that investors ought to put the bout down as a “successful learning experience” for the streamer given that some users reported technical glitches. The success of the fight should pave the way for the company to ramp up its coverage of sports and other live events that will give it “lower subscriber churn and greater ability to take price,” he added.
More sports are coming for Netflix users. The streaming company is set to air two NFL games on Christmas Day, and from January will start broadcasting a weekly WWE Monday Night Raw wrestling show.
As of Sept. 30, Netflix had about $7 billion in cash and it should dip into its pockets to snap up more sports rights, according to Wlodarczak. He pointed to WWE and UFC parent TKO Group and international racing series Formula 1 Group as two stocks that could benefit from a spending blitz.
The more content Netflix can add to its platform, the more it can press its advantages over its streaming rivals and “keep the subscriber flywheel going,” he said.
As of Tuesday’s close, Netflix shares were up 79% in 2024 amid a broader tech rally. The benchmark S&P 500 index has risen 24% this year.
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$Netflix(NFLX)$ Stock Hits Another Record on Wednesday.
$Netflix(NFLX)$ price-target raised to Wall St. high of $1,100 (from $925) at Pivotal Research: "Post the (mostly) successful Tyson/Paul fight, which was streamed by a massive ~65M households (and likely ~150M+ viewers) we raised our medium/long term subscriber and ARPU forecasts, which combined with a modest increase in our terminal EBITDA multiple led to a $175 increase in our NFLX YE’25 target price to $1,100.
We use the term “mostly” given the massive demand led to some streaming issues with certain households early in the broadcast. We view the event as a (very) successful learning experience for NFLX and expect these technical issues will not happen again with future live events. Importantly, given the success of the Tyson/Paul fight we expect Netflix to accelerate its offerings of “eventized” live programming, which further enhances NFLX’s ability to offer households regular compelling content (juiced by the fact their competitors are now selling previously exclusive content to NFLX) = likely lower subscriber churn and greater ability to take price. This led us to make the aforementioned changes to our model (higher long-term subscriber/ARPU forecasts). The NFLX service remains a highly compelling, frankly relatively inexpensive, entertainment alternative for consumers, which bodes well for future subscriber/ARPU growth."