JPMorgan Projects That Netflix Global Paid Subscribers Will Nearly Double By 2024, Driven By International Growth

One Netflix Inc NFLX is increasingly confident in the streaming video platform's international growth opportunity.

The Netflix Analyst

JPMorgan analyst Doug Anmuth reiterated an Overweight rating on Netflix with a $425 price target.

JPMorgan's Netflix Thesis

Netflix's global paid streaming subscriber count is likely to reach 300 million in 2024, Anmuth said in a Tuesday note following an update to JPMorgan's model to reflect Netflix's updated reporting structure. (See the analyst's track record here.)

By the end of the third quarter, the company had 165.93 million global paid streaming subscribers, according to JPMorgan.

The estimate factors in broadband household penetration of 59% in the U.S., 30% in Canada, 41% in Latin America and 20% in the Asia-Pacific region, excluding China.

These estimates represent increases from 53%, 17%, 33% and 10%, respectively, Anmuth said.

JPMorgan Previews Netflix's Q4

For the fourth quarter, JPMorgan maintained a net adds estimate of 7.7 million global paid streaming subscribers, ahead of the 7.6-million guidance figure.

The analyst raised the fourth-quarter revenue estimate by 1% to $5.493 million, almost in line with Netflix's guidance fro $5.442 million.

JPMorgan raised its operating profit estimate by 2% to $495 million versus Netflix's $475-million guidance, primarily to account for currency impact.

Anmuth lowered the fourth-quarter EPS estimate to 3 cents, attributing the move to the $2.2 billion in intra-quarter debt raised by the company.

For the first quarter of 2020, JPMorgan projects global paid streaming net adds of 9.25 million, with the optimism premised on strong content in the back half of the fourth quarter.