Oppenheimer Gives First Look on Netflix 3Q

Oppenheimer has published a report on Netflix NFLX commenting on 3Q guidance. In the report, Oppenheimer writes, "After the close, NFLX reported 2Q results above the Street on margins; however, 3Q guidance was below expectations. Management attributed the weaker outlook to seasonality, higher churn from the new pricing plan and international launch costs. On a positive note, management provided metrics suggesting 4Q ARPU should increase based on the higher rates; margins could exceed guidance if the company does not acquire enough additional content; and a third international launch could occur in 1Q12. Overall, there was enough for the bears to focus on with respect to 3Q. However, we believe most investors own NFLX for the global rollout, which remains intact. Estimates and model under review." Oppenheimer rated Netflix an Outperform with a price target of $360.00. Netflix closed Monday at $281.53.