Netflix is leaving money on the table, analyst says

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Netflix is leaving money on the table, analyst says

But at least one analyst seems to think the streaming behemoth is leaving money on the table, with its content slate drawing massive buzz in the face of fierce criticism. On Thursday, the stock spiked to a new record high at $654, with some on Wall Street expecting a test of levels at or near $700.

He explained that the average subscription cost — $13.99 for a basic plan which Netflix upped in February 2021 from $12.99 — is relatively in line with the cost of a movie ticket a full-price AMC ticket averages $10.50 nationwide. That's just one ticket for one movie, he said.

Still, some analysts are not as bullish on the idea of price increases just yet.

Jon Christian, founding partner at OnPrem — a global technology firm that works with major entertainment networks to drive content performance — told Yahoo Finance that a more cautious approach to subscription pricing is wise, given the competitive landscape.

He suggested that Netflix should look at other streaming giants to understand price points relative to content. He suggested that a big question will be is the amount of content substantial enough to justify a price increase? Santosh Rao, Manhattan Venture Partners head of research, agreed, explaining that there is a cap now because there is competition. We'll see how much elastic it will stick and how much elastic it is. but there is a limit to how much Netflix can raise, he continued.

The competition is not hurting Netflix meaningfully, Greenfield said, suggesting that the second tier platforms like Peacock and HBO were eating Disney and Hulu. They're not really eating into Netflix and I think that's just a function of the amount of content, he added.

Meanwhile, Netflix will welcome even more big-name titles and series in the fourth quarter.

New seasons of some of the platform's most popular shows set to release in the current quarter include The Witcher, Tiger King, and Cobra Kai, in addition to new movies like Red Notice and Don't Look Up.