Raymond James Says Apple's Streaming Plans Are 'More Incremental Than Revolutionary,' Which Is A Good Thing For Netflix

Apple Inc. AAPL is expected to detail Monday its streaming video plans that will likely pose minimal risk to Netflix, Inc. NFLX, according to Raymond James.

The Analyst

Raymond James' Justin Patterson maintains a Strong Buy rating on Netflix with an unchanged $470 price target.

The Thesis

If recent reports are accurate, Apple's streaming video ambitions will focus more on selling users a subscription package to other platforms like HBO with a modest focus on its own original content, Patterson said in a research report. Similar services already exist which implies Apple's new platform is "more incremental than revolutionary" and a new platform won't move the needle in any meaningful way.

Meanwhile, Patterson said box office trends (excluding "Captain Marvel" and "Us") remain "uninspiring" in contrast to Netflix's original content which continues to trend well. Specifically, median IMDB reviews are up 44 percent from last year, which implies movie-goers are interested in what Netflix has to offer.

Although Netflix hasn't yet produced a mega-hit on the scale of "Black Panther," it's moving closer in that direction. In fact, it's merely a matter of time before Netflix is able to consistently launch major releases and the action flick "Triple Frontier" serves as an "early positive signal of that occurring."

Bottom line, Netflix's competitive position "remains durable" and Apple's new platform is unlikely to affect its position.

Price Action

Shares of Netflix were trading higher by nearly 1 percent at $364.28 Monday morning.

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What Everybody Is Saying Ahead Of Apple's Streaming Video Event

Photo courtesy of Netflix.