Industry expert: buy Netflix on the recent sell-off

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Netflix Inc (NASDAQ: NFLX) is down more than 20% in the stock market this morning after the streaming giant said it expects to add less than half the number of net new subscribers in the current quarter than analysts had predicted. Yet, LightShed Partners’ Rich Greenfield says it’s time to buy the stock.

Greenfield’s comments on CNBC’s ‘Squawk Box’

On CNBC’s “Squawk Box”, Greenfield agreed that the guidance for subscriber growth was indeed disappointing, but in the grand scheme of things, he still saw the report as more positive than otherwise.

Netflix added 8.3 million subscribers in Q4. They’re telling you that even with a double-digit price increase, and a content slate that’s a little back-end weighted, they’ll still add 2.5 million in Q1. In the two quarters combined, almost 11 million subs. So, a 20+ million subscriber run-rate.

The stock is now down more than 40% from its all-time high of $692 in mid-November that Richfield sees as a brilliant opportunity to buy at a massive discount. BofA Securities is also convinced that NFLX could be a $750 stock.

Why else is Greenfield bullish on Netflix?

Netflix recorded a 17% year-over-year growth in its Q4 revenue that, as per the co-founder of LightShed Partners, is another positive catalyst for the stock. Greenfield added:

The reality is they’re still growing revenues at a very healthy clip. All signs point to the ability to reaccelerate revenue growth as growth in Asia and even parts of Europe reaccelerate. I remain convinced that the upside here is up to 8.0 million subscribers.

Last night, CFRA’s Tuna Amobi also said that the long-term secular growth story for Netflix was still intact. Its basic plan in the U.S. and Canada now costs more than the rival HBO Max.  

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