*By Michael Teich*
Netflix's strong quarterly subscriber growth doesn't disguise the reality that Wall Street is grossly overvaluing the streaming giant, said Wedbush Securities analyst Michael Pachter.
"The Street is valuing the stock at more like $450 \[a share\], which implies a valuation of more like $200-$225 billion," Pachter said Wednesday in an interview on Cheddar. "That's crazy talk."
It's also nearly a 25 percent premium to where shares closed the day on Wednesday.
In order to justify a valuation that large for Netflix ($NFLX), Pachter said 200 million people ー 63 million more than currently subscribe ー would have to each pay about $100 more per year, or $8 more a month, on the service.
But adding that many users and hiking rates yet again will be tough amid intense competition from both tech and media rivals, he said.
He predicted it would take three years to hit those subscriber numbers.
As far as its monthly cost, he said Netflix can "probably get to $18-20 without competition."
"But there is competition. Competition comes from Amazon ($AMZN) at $11 a month, Hulu at $11 a month, very likely Disney ($DIS) at $15."
Still after a big miss in user growth for the second quarter, Netflix seemed to quell investor concerns when it said it added nearly 7 million subscribers globally last quarter, handily topping the 5 million that the company forecast and the 5.18 million analysts estimated.
Shares initially rose more than 15 percent after its earnings report, but ended up a little more than 5 percent.
Wedbush Securities lifted its 12-month price target to $150 a share, up from $125. That's 60 percent lower than where the stock closed on Wednesday.
For full interview [click here](https://cheddar.com/videos/the-lonely-bear-case-for-netflix).
The trial between Google and the maker of the game Fortnite will begin Monday as a San Francisco jury will hear Epic Games' case claiming the Google Play Store takes an unfair commission on purchases made through apps.
One of the most self-made and success stories in the country, Emma Grede, has worked along with the Kardashian Jenner family on many of their best-known brands. Grede, CEO and co-founder of Good American, gave back to the next generation of business leaders as a featured speaker at the Chase for Business Make Your Move summit last week. She spoke with Cheddar News about her career, her company's fashion brand, working with the famous Kardashian-Jennifer family and balancing her own family life.
Berkshire Hathaway, the conglomerate run by businessman Warren Buffett, reported its operating earnings in its most recent quarter jumped more than 40% from a year ago but posted its first net quarterly loss in a year.
Elon Musk's company XaI has announced a new chatbot called Grok.
SAG-AFTRA said over the weekend that it received the studios' last best and final offer following a meeting on Saturday, with the union saying it's reviewing it and considering a response "within the context of the critical issues addressed in our proposals."
Stocks rose slightly as Wall Street looks to continue its momentum with earnings season winding down.
Tyson Foods is recalling about 30,000 of its dino-shaped chicken nuggets after some consumers reported finding small metal pieces in those nuggets.
Google on Monday will try to protect a lucrative piece of its internet empire at the same time it’s still entangled in the biggest U.S. antitrust trial in a quarter century.
Before the SAG-AFTRA strike, this was the weekend “Dune: Part Two” was supposed to open. When Warner Bros. and Legendary pushed that opening back to March 2024 and no other blockbuster stepped in to take its spot.
A growing number of Californians are planting agave to be harvested forz use in spirits. The trend is fueled by the need to find hardy crops that don’t need much water and a booming appetite for premium alcoholic beverages.
