Netflix Inc.'s stock price target was bumped up to $730 from $585 at Raymond James, which cited improving usage and content. Analyst Justin Patterson's new target is 10% above Monday's closing price of $662, and 7.2% above the stock's June 23 record close of $681.19. Patterson reiterated his outperform rating, saying his firm's second-quarter consumer survey showed signs of improving content quality, which supports his view of strong subscriber growth and improving retention--49% plan to keep Netflix and 54% subscribe for original content, compared with 41% and 49%, respectively, in the first quarter. And based on reviews on IMDB, Netflix's original content ranks ahead of broadcast peers, and in line with Showtime, Patterson said. Since Netflix seems to understand the cloud, Patterson said he believes the video streaming service "will figure out programming faster than media companies can figure out the cloud." The stock, which edged up 0.2% in premarket trade, has soared 94% year to date, compared with the S&P 500's 0.5% gain.
Copyright © 2015 MarketWatch, Inc.
Continue Reading Below