CNBC's Jim Cramer on Wednesday chided investors for selling Netflix shares after an analyst downgrade and strong quarterly results. "If people want to sell it, good luck to them," Cramer sarcastically said on "Squawk on the Street," noting Netflix shares have been a "great long-term performer and that matters." The stock has gained about 16% this year and more than 500% in the past five years. "People have to step back and say first of all the stock's been up big," he said. "Yes, we do have one lonely downgrade and that's based on valuation." Netflix closed nearly 2.2% lower after the stock was downgraded by Deutsche Bank to hold from buy despite better-than-expected earnings and subscriber additions in the third quarter. Deutsche Bank maintained its 12-month price target of $590 per share, which would is roughly 7% below where the stock closed Tuesday. Analysts for the bank were troubled by what they see as slowing growth in revenue, which rose 16% to $7.48 billion in the third quarter, matching expectations. Deutsche Bank estimates 15% revenue growth in 2022 compared to 19% this year. "We believe it is difficult to justify Netflix's recent multiple expansion when revenue growth is decelerating." Cramer called the post-earnings call Tuesday evening "brilliant," saying that "if you look at the beauty of the Netflix call … it is very clear that they have this international strategy." Netflix co-CEO and chief content officer Ted Sarandos praised "Squid Game" on the call, saying that viewing of the South Korean show "looks a lot like a local language show in any country you look at it," suggesting that people who don't speak Korean were willing to watch with subtitles or the dubbed versions. Since its Sept. 17 release, "Squid Game" has become Netflix's biggest TV series ever , with 142 million subscribers having watched at least two minutes of it. That's two thirds of its 213 million global subscribers. "People who are in the stock market, we talk to them and they've had Netflix, they've had Amazon , they've have Facebook ," Cramer said, suggesting Netflix has again become a favorite among tech investors. The stock often faces skepticism around the release of quarterly earnings but has proven it can bounce back over time.
Mario Tama | Getty Images News | Getty Images