Netflix Stock (NASDAQ:NFLX)
According to a poll conducted by Jefferies, Netflix’s (NASDAQ:NFLX) upcoming implementation of charging for password-sharing across households might have detrimental effects on the company’s bottom line.
The investing company surveyed 380 “password borrowers” and found that 62% of them stated they would cease using Netflix (NFLX) for various reasons, the most common of which was cost. About 31% of respondents stated they were unwilling to pay for the service because they did not like the material. In comparison, 35% claimed they could get the same from a different provider.
Other noteworthy takeaways from the study were highlighted by analyst Andrew Uerkwitz, who has a buy rating and a $425 per share price target on Netflix stock. He noted that 69% of respondents who indicated they could replace Netflix (NASDAQ:NFLX) rated it as one of their top three favorite services.
Furthermore, 32% said that they turn to Netflix when they lose what to watch, and 24% stated that it is the service they would be least likely to give up.
Uerkwitz reassured customers in a letter that “our calculations anticipate 21% retention of borrowers in 2023, climbing to [roughly] 45% by the end of 2024,” citing a study in which 38% of respondents said they would keep their passwords secret.
The study also found that although over 700 individuals do not have access to Netflix, almost 40% are at least “very interested” in the company’s ad-supported tier.
Nearly half of those who had borrowed passwords (48%) have admitted to leaving and then returning to a streaming service at least once a year, up from around 46% in the previous study.
The study also stated that Walt Disney and Comcast are more formidable opponents to Netflix. At the same time, Google’s YouTube is “ideally positioned” to benefit from a pricing war.
In Monday’s midday trade, Netflix stock was down slightly.
General Motors and Netflix announced their partnership last week so that GM’s electric cars might be included in Netflix’s popular shows and films.
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