After Netflix reported a surprise surge in its subscriber numbers, share prices in the company suddenly took off Wednesday.
Business Insider reports that key numbers in the streaming service’s first-quarter financial report included net additions of 2.28 million U.S. streaming subscribers, vs. an anticipated 1.8 million; additions of 2.6 million international users, vs. 2.25 million expected; and earnings per share of $0.77, vs. an expected $0.69.
Total subscribers worldwide are now reportedly 62.30 million, vs. the forecast of 61.44 million. The addition of about 4.9 million worldwide subscribers was a record, the report notes.
Netflix shares were up more than 12% in after-hours trading Wednesday, the story reports. But that may be just the beginning. Bloomberg reports that the stock price, which closed Wednesday at $475 a share, is expected by at least one analyst to go much higher.
Bloomberg provides the following quote from a new report by FBR analyst Barton Crockett:
“We are upgrading shares of Netflix, Inc. (NFLX) to Outperform and raise our price target to $900 (from $400). The key driver is our proprietary survey work, in collaboration with ClearVoice Research, LLC, which says that domestic Netflix subscribers — nearly 40% of TV households in the U.S. — love the service more than TV. Our survey (conducted in early April across more than 2,000 consumers representative of the U.S. in key demo categories) is consistent with the robust embrace apparent in Netflix’s 1Q15 earnings report, post-close Wednesday, April 15. In this outpouring of affection, we see Netflix as very likely to move towards 180 million global subscribers by 2020 (over 60 million in the U.S.).”