Netflix Inc., the video-streaming service, gained after Bank of America Corp. raised its rating on the stock to buy from underperform.
Netflix, based in Los Gatos, California, rose 3.1 percent to $61.76 at the close New York time. The stock has dropped 11 percent this year.
International expansion, smarter spending on content and rising domestic profit, combined with the drop in the stock after second-quarter results makes Netflix a compelling purchase, Bank of America analysts led by Nat Schindler said today in a note. They have a $72 price target on the stock.
Netflix plunged 25 percent on July 25, the most in nine months, after the company said reaching its full-year goal of adding 7 million new U.S. users would be “challenging” if the current quarter’s most optimistic targets aren’t met.