USB Piper Raises Netflix Outlook

Analyst Safa Rashtchy says he's impressed with the video-rental subscription company's ability to achieve the top-end subscriber guidance range

USB Piper raised its target on Netflix (NFLX ).

Analyst Safa Rashtchy says Netflix reported 1.29 million total subscribers, which was better than expected and slightly ahead of the video-rental company's guidance range. He says based on the new subscriber count, Netflix's revenue estimate of $68.9 million could increase by $700,000 to $1 million.

Rashtchy thinks Netflix's nationwide, household penetration long-term goal of $1 billion in revenue and $100 million to $200 million cash flow is achievable in the next four to six years. Although he's impressed with Netflix's ability to achieve the top-end subscriber guidance range, he believes the most compelling aspect of the business is its operating leverage.

Rashtchy thinks Netflix's stock warrants a premium to the e-commerce comp group average, and raised his price target to $39.

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