Netflix has been largely left behind by the rest of the market this summer, yet Wall Street believes that the streaming giant has what it takes to rev higher again. The stock is up a mere 2.8% over the past three months, while the S & P 500 is up 7% in that time. Alphabet , which owns YouTube, has soared 38% in that time. This underperformance may seem counterintuitive, considering that Netflix just had its biggest hit in “KPop Demon Hunters” over the summer. In August, the movie marked Netflix’s first No. 1 box-office title ever . Sell-side analysts and investors think the stock will soon get out of it summer doldrums. “For a company and a stock that has done so well over five or 10 years, the question is, is it over? And I think what we’ll see is the company continues to execute and grow,” said Ken Leon, CFRA director of equity research. Leon currently has a strong buy rating on the stock. NFLX YTD mountain NFLX YTD chart Left behind, but why? Several factors may have conspired against the streaming stalwart. For one, investors may have left Netflix behind to chase high-flying artificial intelligence stocks, according to Accuvest Global Advisors portfolio manager Eric Clark. Chipmaker AMD has soared more than 50% over the past three months. Intel is up a whopping 65%. Meta Platforms and Nvidia have gained 3.7% and 6.8%, respectively, also outperforming Netflix. “Right now, it’s just a good time to remind yourself that this is a really good business with really good scale that still has good growth opportunities,” Clark told CNBC, calling Netflix a “staple of life.” “The market isn’t rewarding that kind of thing right now, but it will. It always does.” Uncertainty around the company’s subscription numbers may also be keeping the stock in check. Netflix this year stopped disclosing quarterly subscriber numbers, a move by the company to force investors to judge it by other metrics such as revenue and time spent on the platform. Still, this change could be “bringing a little bit more anxiety” leading into the quarterly reports, said Paul Meeks, head of technology research at Freedom Capital Markets. He also noted some on the Street may be worried that the recently merged Paramount Skydance could pose a meaningful threat, potentially weighing Netflix down this summer. “Maybe, after all these years, we’re going to get a legacy media company that can actually compete with Netflix — but I’ll believe it when I see it,” Meeks said to CNBC. Looking ahead, investors and analysts pointed to several positive drivers for the stock, including the company’s upcoming third-quarter earnings report. Content is king Netflix is set to post earnings Tuesday after the bell. Analysts from UBS, Wells Fargo, Bernstein and KeyBanc Capital Markets all reiterated their positive stances on the stock heading into the print, pointing to a strong content slate as a catalyst to further drive subscriber retention and engagement. All four of those firms have buy or overweight-equivalent ratings on the stock. The buyside is just as bullish. The company’s content pipeline “should result in strong subscriber metrics, accelerating revenue growth and expanding operating margins,” Nancy Tengler, CEO and CIO of Laffer Tengler Investments, said to CNBC over email. Meeks of Freedom Capital described this pattern of strong content driving more subscribers and, in turn, more revenue as a “virtuous cycle” for the company. CFRA’s Leon also applauded Netflix’s history of strong revenue growth, widening margins, free cash flow generation and cost discipline as successful factors in supporting its high valuation. But one of the key growth opportunities for Netflix going forward comes from live events — specifically sports. This could include streaming NFL, NBA and MLB games, among others. The Athletic reported late last month that Netflix would stream the New York Yankees against the San Francisco Giants on opening day of the 2026 season next year. Netflix also set a streaming record last year with its slate of Christmas Day NFL games. “The sports market is huge, and people are dying for a video streaming alternative to ESPN,” Meeks said. “ESPN with their brands, they’ll be the lead — but there’s a big, big opportunity for Netflix to get big into live sports, and they’ll do it.” Wells Fargo analyst Steven Cahall noted last week that the NFL could be Netflix’s next big boon. He said the company could pull away some Sunday afternoon games from CBS and Fox “to create a new national streaming window. … This could yield another $3bn in annual NFL media rights fees, and could also be the sort of package that NFLX is saving room for.” Advertising revenue will be another big growth driver for Netflix, with Tengler pointing to the streamer’s recently inked brand and marketing partnership with AB InBev as evidence of the company’s future prospects. Meeks added that Netflix’s lower-cost subscription tier that includes advertisements has helped cement its status as an ad-supported company, rather than one totally dependent on subscriber fees. From a competitive standpoint, Leon said that Netflix appears to be holding its own against other video streamers. With Disney+ having recently raised its prices, Netflix’s base offering is now 50% cheaper, Tengler said, although she expects Netflix to in turn raise its subscription fees next year. Meeks and Leon also respectively nodded at Netflix’s crackdown on password sharing and its growing podcast business as other potential tailwinds. Accuvest’s Clark added that while Netflix is by no means a traditional AI play, the stock could “absolutely” be considered an AI beneficiary. Already, the company has been using AI in its content creation and to help boost user engagement and personalization with its massive catalogue, he said. Where to from here? How Netflix stock reacts to its third-quarter earnings release remains to be seen. But Meeks said that if shares of Netflix continue to stagnate — or weaken — it will be a better buy for his clients. A “decent place to buy” the stock would be around the $1,150 mark, Meeks said. This would be approximately 4% below where the stock closed on Friday at $1,199.36. But should the price go below $1,107 — Netflix’s 200-day moving average — Meeks said that he’d “probably buy it with both hands.” “The last time the stock went below the 200-day support was 2022, and it was only briefly,” he noted. NFLX 5Y mountain NFLX 5Y chart Over the next 12 months, Leon believes that shares of Netflix could reach $1,485, signifying an upside of 24% ahead. Clark’s price target of between $1,500 and $1,600 implies even greater gains going forward, with the higher end of his range corresponding to a 33% rally. ( Learn the best 2026 strategies from inside the NYSE with Josh Brown and others at CNBC PRO Live. Tickets and info here . )
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