While Crockett lowered the stock to a “neutral” rating, analysts at Citigroup, Barclays, and JPMorgan Securities raised price targets and ratings to “buy” for the rental company.
The “buy” argument? Customer growth may help convince investors the company can reignite subscriber interest.
But Crockett thinks the current level of growth is not enough to cover the company's streaming expenses. As Netflix shifts customers from its DVD-by-mail rental service toward instant streaming, Netflix has been writing ever-heftier checks to acquire more TV programs and movies for its streaming service.
Futhermore, he believes the stock is too expensive.
“They're trading at a (price-to-earnings ratio) of 27 times earnings per share, which means you've got a real valuation argument,” he said. “There's a real debate about the market opportunity for this company, which is what this hinges on.”
This too leaves Crockett on the contrarian side of the street. Shares of Netlix soared some 21 percent to $118.84 in early trading on Nasdaq.
Last year, the stock had dropped to a year's low of $62.37 on Nov. 30, 2011, after Netflix outraged customers with a surprising price increase and a botched attempt to split off its DVD mail-service.
Crockett reminds investors of last year's hit, which affects annual returns.
"For the year, because subscriber growth is lower, I actually have them losing 51 cents,” said Crockett. “So you have a money loser this year, and an outlook for making a dollar next year.”
Put simply, Crockett thinks the stock is overvalued.
—Reuters contributed to this report.
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Lazard Capital Markets makes a market in Netflix securities. Crockett does not personally own the stock.