Netflix is still a must-have service, but if there's a recession on its way, it could bode poorly for the streaming stock, according to Bank of America. The firm lowered its price target on Netflix shares Thursday, to $196 from $240. The new price target is almost 10% away from where the stock price closed Wednesday. Bank of America also reiterated its underperform rating on the stock. A recession scenario could drive higher subscriber churn or limit pricing power, the firm's analyst Nat Schindler said in a note Thursday. "Streaming could be sticky in a recession, but platforms will see recurring cancellations and resubscriptions coinciding with scheduled releases of original content, particularly among the lower-income user base," he said. "If a recession were to take hold," he added, "it wouldn't be surprising to see incremental churn." Ad-tiering could be one way for customers across income brackets to stretch their streaming budget, Schindler said. It would allow them to trade down in order to subscribe to an additional service. However, that would benefit Netflix's competitors more than Netflix itself, he noted. Furthermore, Bank of America sees the company's "must-have" status as more of a blessing than a curse. "We believe Netflix will remain the dominant provider so long as its content library remains expansive and has several big-name original content products that keep users subscribed. However, as more and more competitors come online and build their content libraries, the collective power of and fragmentation of the industry under Netflix is going to be an increasing driver of churn," Schindler said. —CNBC's Michael Bloom contributed reporting.