Last night, Netflix announced slightly lower-than-expected annual forecasts and its decision to stop publishing its new subscriber figures, causing its share price to fall by nearly 8% on the New York Stock Exchange in early trading on Friday.

However, on Thursday, the American Internet video specialist reported significantly higher-than-expected first-quarter subscriber numbers.

The company said it had gained more than 9.3 million net new subscribers in the first three months of the year, compared with the five million expected by analysts on average.

In a reaction note, BofA analysts say they have raised their price target on the stock from $650 to $700 following this performance, while reiterating their buy recommendation.

Some professionals, however, consider the forecasts communicated by the Californian group for the second quarter and full-year 2024 to be rather disappointing.

For the current quarter, Netflix said it was aiming for 16% sales growth, compared with 15.9% in the first quarter, but its forecast for 2024 is more modest, at between 13% and 15%.

Investors seem especially muted by the announcement that the company has decided to stop disclosing new subscriber figures from its 2025 quarterly publications.

It may still be a little too early to say, but the problem is that subscriber growth has slowed considerably in 2022 (before the end of code-sharing), which could be a harbinger of slower growth to come', decipher BofA's teams.

According to Wedbush, this decision is consistent with its theory that Netflix is currently in the process of switching from a high-growth model with limited profitability to lower, but more profitable growth.

'Even so, this pivot to high profitability and slower growth is still far from complete', stresses the research firm.

For some analysts, this quarterly publication is simply an opportunity to take profits after the spectacular stock market performance of the VOD specialist in recent months.

"Even if these results and the outlook are rather solid, we see few catalysts likely to sustain growth in the coming quarters", warns Canadian broker Canaccord Genuity.

Given that the stock has surged by almost 90% over the past 12 months, and by around 25% since the start of the year, investors would be well advised to look elsewhere for upside potential", it adds, lowering its recommendation on the stock from "buy" to "hold".

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