Here's what every major analyst is saying about Netflix's earnings report

Published Thu, Oct 17 20197:49 AM EDTUpdated Thu, Oct 17 20191:09 PM EDT

Wall Street analysts are breathing a sigh of relief after Netflix earnings beat the street o n Wednesday after the bell. That doesn't mean the streaming giant is in the clear, though. In fact, expectations remain high for Netflix going forward and rightly so according to analysts. Domestic subscriptions came in below estimates and competition looms from Disney and Apple though the company largely said it welcomed it. Shares of the company are up over 4% in midday trading. Here's what else analysts are saying about Netflix's earnings report: "We see Netflix's results providing relief to investors, as international subs beat and 4Q sub guidance looks conservative," Bank of America analyst Nat Schindler said. "Yet, we remain wary of competition and think U.S. sub growth will be harder won going forward," he said. The sentiment was largely the same from analysts at UBS. "This quarter does not put short/medium term debates to bed as investors will continue to digest mgmt commentary on churn, competition, & debt enabled content spend as progress is made to FCF+," analyst Eric Sheridan said. "We continue to see NFLX as a long term secular growth winner in the sector," he said. But the next earnings report will be key and investor anxiety remains according to analysts at Bernstein. "None of this makes the risks completely go away," analyst Todd Juenger said. "Q4 (and 2020) will still be viewed by many investors as a crucible, at least in the US where Disney+ launches." Bank of America- Buy rating, price target to $426 from $450 "We see Netflix's results providing relief to investors, as international subs beat and 4Q sub guidance looks conservative. We also continue to see upside to '20/'21 margin and EPS, with operating income surprising consensus by a double digit percentage each quarter so far in '19. Yet, we remain wary of competition and think U.S. sub growth will be harder won going forward." Barclays- Overweight rating "Overall, concerns around the impact of new services such as Disney+ on NFLX are likely to be impossible to disprove till early 2020. While management seemed to dismiss 10bps higher churn, across the entire base that would translate to a ~ 2mm lower net adds annually if sustained which is material. Therefore, while the stock reacted well in afterhours, we believe performance is likely to remain range-bound till the end of '19. In that context, we believe Q3 was more about defining a downside floor for this range." UBS- Buy rating "This qtr does not put short/medium term debates to bed as investors will continue to digest mgmt commentary on churn, competition, & debt enabled content spend as progress is made to FCF+. For us, the key debate isn't the launch of DIS+ (the focus on a winner take all vs. the history of media fragmentation has surprised us in terms of debate/sentiment) but will remain the type of scale that NFLX will likely achieve (mostly driven by int'l) against the content/mktng invtmts. We continue to see NFLX as a LT secular growth winner in the sector." Credit Suisse- Outperform rating "Netflix is a secular winner that has already underperformed due to competition concerns, its differentiated international and film content efforts are kicking in, and investor expectations are now reasonable." Morgan Stanley- Overweight rating "Against a wall of worry, results were better than feared and broadly in-line. Highlights were modestly higher int'l paid net adds in 3Q, reiteration of continued margin expansion, and commitment to FCF improving in '20. It is possible net adds have peaked, but earnings power has a long way to run." Bernstein- Outperform rating, price target to $422 from $450 "We were mentally prepared for a long night of soul searching on Netflix. Fortunately, we get a reprieve from that, at least for another 3 months. .. .None of this makes the risks completely go away. Q4 (and 2020) will still be viewed by many investors as a crucible, at least in the US where Disney+ launches. The 2nd-in-a-row US sub miss, while tiny, will be scrutinized even harder in Q4 when Disney+ launches. The lowered Q4 guide, for abundance of caution, should help the set-up for Netflix." Wells Fargo- Outperform rating, price target to $308 from $288 "For growth bulls this quarter showed NFLX still has plenty of runway. For cash bears this quarter showed NFLX's ROIC still leaves a lot hit risk. While we think the market is less likely to get as negative as it has been on subs in the near-future, it's also tough to get too positive amidst Disney+/Apple+ launches a wide range of FCF expectations." Goldman Sachs- Buy rating, price target to $400 from $360 "As Netflix's content investments, distribution partnerships and marketing drive subscriber growth significantly above consensus expectations and the company approaches an inflection point in cash profitability, we continue to believe shares of NFLX will significantly outperform." J.P. Morgan- Overweight rating "Overall, we believe 3Q earnings provides increased confidence that NFLX will continue to add subs at a healthy pace while withstanding new competitive streaming threats. 4Q content is very strong—The Irishman, Marriage Story, The Two Popes, 6 Underground, The Crown S3, among others—and we believe more streaming options will ultimately accelerate the shift away from linear TV, benefiting NFLX." Guggenheim- Buy rating, price target to $400 from $420 "As the company continues to ramp internationally, we remain positive on the multi-year outlook given comments around the strength of scalable, globalized content, multi-year pricing power, and improving profitability. We are confident in the subscriber and economic growth potential of the business over the long term; however, we do expect investors to remain cautious due to the overhang from competition. We are lowering our 12-month price target to $400 from our prior $420 based on higher operating expenses and slightly lower subscriber additions." Macquarie- Downgraded to neutral from outperform "In some ways Netflix has defied the naysayers in Q3, coming close enough to guidance and delivering impressive revenue and earnings growth. We still think its opportunity is excellent, especially internationally where sub adds should continue to step up. But it's hard to deny the US is maturing, with sub add growth halving this year and the revenue effect of the price increases wearing off in Q1'20." Deutsche Bank- Buy rating, price target to $395 from $400 "3Q results were better than we estimated and better than most investors feared going into the earnings announcement. Most importantly, international net adds slightly exceeded management's guidance, preserving the positive international long term growth thesis. The soft spots in 3Q were limited to US net adds and for-eign currency impact."

Reed Hastings, chief executive officer of Netflix Inc.

Akio Kon | Bloomberg | Getty Images

Wall Street analysts are breathing a sigh of relief after Netflix earnings beat the street on Wednesday after the bell. That doesn't mean the streaming giant is in the clear, though.

In fact, expectations remain high for Netflix going forward and rightly so according to analysts. Domestic subscriptions came in below estimates and competition looms from Disney and Apple though the company largely said it welcomed it.

Shares of the company are up over 4% in midday trading.

Here's what else analysts are saying about Netflix's earnings report: