The stock tanked 13 percent in the following trading session, despite better-than-expected Q2 earnings of 9 cents per share and in-line revenue of $2.11 billion. Since then, Netflix has recovered about 10 percent of those losses.
"If they can make sub numbers, there's a lot of upside movement in this stock. We still think they have pricing power," Mahaney said.
According to RBC research, he said: "About 50 percent of all U.S. broadband households are Netflix subscribers," while "70 percent of Amazon Prime customers are Netflix subscribers as well."
In addition to free shipping, Amazon Prime users, at $99 per year, get a number of other services for free, including Amazon streaming video.
"The biggest push back I probably get [is] ... isn't Amazon Prime going to dislocate, dislodge, destroy Netflix," Mahaney said. "[But] I don't think Amazon is a competitive threat."
Netflix is "about eight times bigger" than its closest competitor in terms of paid subscribers, he said. "The closest company would be Hulu, with about 10 million paid subscribers."
As television viewing evolves over the next 10 to 15 years, Mahaney sees the big content bundles from cable and satellite TV moving to what he calls "mini-bundles" at much lower prices.
"I think one of those five mini-bundles in the future will be Netflix," he said.