'Stranger Things' Not The Only Netflix Catalyst In Q4

Many fans of Netflix, Inc. NFLX's "Stranger Things" series will likely be binging on the second season over the weekend. This may prove to be a "core catalyst" for the stock in the fourth quarter, Loop Capital Markets' David Miller said in a research report.

Netflix's "Stranger Things" has proven to be one of the more popular original content releases on Netflix, but for investors, it represents a "strategically-balanced" show with "cross-quadrant appeal," the analyst said. But the series evolved to become a "show that family can watch together," despite the pop horror genre.

Encouragingly for investors, "Stranger Things" isn't Netflix's only catalyst for the fourth quarter, Miller said. Some of the other original content shows, including the recently released "Mindhunter" and the second season of "The Crown" (Dec. 8) will prove to the "prime-mover catalysts" for fourth-quarter net subscriber adds.

Meanwhile, it isn't too late for large-cap growth-related investment firms to take new positions in Netflix's stock, despite shares hovering near $200, the analyst also said. Netflix is, after all, one of the only true large-cap growth stories in the entire media space and will become a "significant" free cash flow producer by 2020 which makes the stock attractive over the longer-term with plenty of upside still ahead.

Miller maintains a Buy rating on Netflix's stock with a price target lowered from $242 to $237 to reflect the leverage impact of the recently announced $1.60 billion offering.

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