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Netflix stock upgraded at Jefferies on ad-tier optimism, password crackdown

Netflix (NFLX) stock received a Wall Street upgrade on Thursday ahead of its fourth quarter earnings results, extending a recent winning streak for shares of the streaming giant.

Jefferies analyst Andrew Uerkwitz upgraded the stock to Buy from Hold and increased his price target to $385 from $310 a share, citing long-term catalysts like the platform's recently-debuted advertising tier, in addition to its crackdown on password sharing.

"[Advertising video-on-demand] will be slow to kick in, but when it does (paired with password sharing changes), it should drive top line outperformance," Uerkwitz wrote in his note to clients.

He estimated revenue and adjusted EBTIDA at Netflix will come in well above Wall Street estimates in 2024, thus resulting in margin upside and valuation expanding back towards historical averages.

Netflix shares were up about 1% on Thursday. The streaming giant, up nearly 90% over the past six months, has seen shares climb more than 10% so far in January, outperforming the Nasdaq Composite's 2% gain.

Earlier this week, Goldman Sachs boosted estimates for Netflix's average revenue per user and GAAP operating income amid a weakening U.S. dollar.

The firm also increased its price target on the stock to $225 from $200 per share.

Netflix is set to report earnings on Jan. 19 after the market close — with Wall Street setting lofty goals for the company.

JPMorgan anticipates fourth quarter subscriber net additions of 4.75 million, above consensus estimates (and the company's current guidance) of 4.5 million.

"Monster: The Jeffrey Dahmer Story" (Courtesy: Netflix)
"Monster: The Jeffrey Dahmer Story" (Courtesy: Netflix)

Alexandra is a Senior Entertainment and Media Reporter at Yahoo Finance. Follow her on Twitter @alliecanal8193 and email her at alexandra.canal@yahoofinance.com

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