For a while there, FAANG stock Netflix (NASDAQ:NFLX) looked like it was in open decline thanks to many changes that viewers might not have been happy about. However, investors seem increasingly content as NFLX stock closed higher in Tuesday’s trading. Reports suggest that Netflix’s new ad-supported tier will likely bring in some fresh and formerly lost viewers.
The new compensation scheme recently revealed for top brass also seems “shareholder friendly.” That’s thanks to its heavy focus on stock options. Several major new releases give Netflix some life as well, and reports even suggest the company’s download rates imply new viewer bases are in the making.
Such points are valid and offer further exciting potential. “Glass Onion: A Knives Out Mystery” is now the fifth-most-watched title on Netflix. It landed over 253 million hours in just 17 days after its release. Netflix’s increased openness about its viewer counts will likely drive interest as well; a better handle on how many people are watching what, and when, should catch investors’ attention.
A slew of titles also face cancellation going into season 2. This might backfire for Netflix. If it cuts too many shows without proper endings, viewers may lose faith in the company. However, it also shows Netflix isn’t afraid of hard decisions about protecting cash flow, either.
Netflix shares currently enjoy decent support from Wall Street, as they are considered a Moderate Buy by analyst consensus. However, thanks to its average price target of $304.56 per share, Netflix stock comes with 7.02% downside risk.
