The Bull Case for Netflix Stock Is Stronger Than You Think

Netflix (NASDAQ:NFLX | NFLX Price Prediction) has been a punching bag for the past year, but our model sees a very different setup heading into 2027. With the stock trading at $81.72, down 33.64% over the last twelve months, sentiment has rarely been this washed out on a company still growing revenue in the double digits.

Our 24/7 Wall St. price target for Netflix is $181.89, implying 122.58% upside over the next twelve months. Our recommendation is buy, with confidence classified as high.

24/7 Wall St. Price Target Summary

Why Netflix Sold Off and What Just Changed

Netflix stock is down 12.84% year to date and sits about 26% below its 52-week high of $126.71. Shares are up 10.99% over the last month and 2.68% in the past week.

Q2 2026 delivered revenue of $12.56 billion, up 13.37% year over year, with EPS of $0.80 beating consensus. Double-digit growth showed up across every region, led by Latin America at 21%.

Seeking Alpha noted Bill Ackman’s return to Netflix, and a widely upvoted WallStreetBets thread titled “Why the fuck is Netflix down 40% over the past year?” captured retail frustration that often marks capitulation lows.

Why Bulls See a Breakout Ahead

The bull thesis rests on three pillars: advertising, pricing, and runway. Netflix is guiding 2026 revenue to $51 billion to $51.4 billion with ad revenue roughly doubling to $3 billion, and free cash flow near $12.5 billion. Advertiser count already grew 70% year over year to over 4,000 clients.

Management flagged the company is only under 45% penetrated into 800 million addressable households globally and captures roughly 5% of global TV view share.

Buybacks are massive: $4.7 billion repurchased in Q2 2026, the largest quarter in company history, with $27.1 billion remaining. If ad monetization scales as guided, the bull case points to $195.83.

Risks Worth Watching

The bear case leans on decelerating FX-neutral growth (from 12% in Q2 to 11% guided in Q3), content amortization growing roughly 10%, a $1 billion debt maturity in 2026, and viewership competition from the Winter Olympics and World Cup.

Q2 free cash flow declined 32.73% year over year, but bulls counter this reflects higher cash taxes tied to the Warner Bros. termination fee received in Q1, with core operations still intact. Insider activity trending net selling is worth noting. Our bear case lands at $144.89, still well above the current quote.

How Netflix Compares to Disney and Spotify

Disney (NYSE:DIS) trades at a trailing P/E of 15 with an operating margin of 14.6%, versus Netflix at 26 and a Q2 operating margin of 33.4%. Disney is cheaper on paper, but Netflix earns its premium with more than double the operating margin.

Spotify (NYSE:SPOT) trades at a trailing P/E near 51, with Q2 revenue growth of 13.9%. That is nearly identical growth to Netflix, but at almost twice the earnings multiple. Against this pair, our 24/7 Wall St. price target looks reasonable, closer to conservative.

Bottom Line on Netflix’s Setup

The 24/7 Wall St. price target of $181.89 reflects a stock priced for stagnation and a business still executing. Our model’s recommendation is buy, with high confidence.

The bullish scenario strengthens if the ad tier continues doubling and buybacks keep pace, while the setup weakens if FY26 guidance slips or FCF conversion deteriorates materially. Given 71% bullish analyst coverage and zero sell ratings, the risk/reward is skewed to the upside.

These projections assume Netflix continues executing on advertising growth, pricing power, and buybacks. Significant upside or downside could come from large-scale M&A or a step-change in streaming competition.

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