Analyst Peter Supino said the company's premium valuation does not provide enough safety to counter the rising risk of reduced growth.
Netflix 's valuation may not be able to withstand falling growth expectations, according to Wolfe Research. Analyst Peter Supino downgraded the streaming service to peer perform from outperform. He removed his price target on shares, which was previously set at $500. Shares closed Thursday's trading session at $361.20.
"With reports of slow AVOD adoption, recent ARM shortfalls signaling trade down, management signaling less margin expansion, and a lack of compelling 3P data on sub growth, we believe the risk/ reward for NFLX is balanced." In the medium term, the two biggest driver's of Netflix's multiple also look increasingly risky, Supino added.
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