Netflix Ousts Disney as Morgan Stanley's Top Media Choice for Q1, Signaling Sluggish Retail Sentiment

Netflix, Inc.'s (NFLX) financial figures for the initial quarter will be released in about a week, and prior to this significant occurrence, the leading streaming company has gained support from an investment bank on Wall Street.

On Wednesday, Morgan Stanley issued a statement naming Netflix as its leading choice in the media and entertainment sector, taking over from Walt Disney Co. (DIS) which previously held the top spot.

Analyst Benjamin Swinburne maintained an 'Overweight' rating with a target price of $1,150 for Netflix shares, suggesting approximately 22% growth potential based on Wednesday's closing price.

The analyst maintained an optimistic outlook due to his belief that the streaming behemoth demonstrates notable stability even in a challenging global economic climate.

President Donald Trump’s extensive tariffs introduced the previous week cast a shadow over the possibility of an economic downturn. However, he has since backed down from his stance. declared a 90-day halt in enforcing the tariffs For most countries, with the significant exception of China.

Swinburne revised his prediction for Netflix's advertising revenue growth in 2025 to 15.4%, when not factoring in currency effects, keeping his overall projected growth rate steady at 13.5%.

He aims for an advertising revenue of $1.3 billion in 2025, which would be an increase from $700 million the previous year, based on expectations of growth in ad-supported users with no anticipated change in advertising revenue per user (ad RPM).

When examining Netflix’s Engagement Report from the latter part of 2024, the analyst mentioned that approximately 30% of streaming time was dedicated to content not in English, whether original productions or exclusives. The report also highlighted strong viewer involvement with the platform’s back catalog.

The analyst anticipates sustainable growth for Netflix thanks to its distinctively worldwide programming and production abilities, a fully integrated business structure, and valuable expanding content assets.

Nevertheless, retail investors continued to show caution regarding Netflix. A current survey revealed that just 12% of participants considered the firm to be their top choice among communication services stocks for purchase.

The platform users had a 'neutral' stance (53/100). Netflix stock By late Wednesday, it had improved compared to the 'bearish' sentiment of the previous day, though the message count on the feed remained 'high.'

An optimistic observer grounded their hopefulness in the anticipation that the firm would announce impressive earnings figures the following week.

Yet, another individual referred to the Netflix stock as a "bear trap."

Netflix closed Wednesday's trading session up 8.62%, reaching $945.47 per share, marking a 6% increase for the year so far.

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