Netflix's Growth Undervalued Despite Strong Global Content, AI Leadership, Deutsche Bank Says

11:03 AM EDT, 09/29/2026 (MT Newswires) -- Netflix's (NFLX) growth outlook is being undervalued despite its competitive edge, lead in overseas production and ability to deploy artificial intelligence better than media rivals, Deutsche Bank said in a note emailed Tuesday. The bank upgraded its rating on Netflix's stock to buy from hold and reduced the price target to $95 from $100. The upgrade was driven by positive international engagement trends, which have increased year-over-year in each of the last four six-month periods, and a global content strategy as the company has moved over 60% of production outside the US, according to the note. "Netflix has an established competitive advantage and substantial lead over competitors in international production, which is evident in Netflix's well-diversified geographic content production mix," Deutsche Bank analyst Bryan Kraft said. "We believe this advantage will allow Netflix to sustain its global leadership position." The streaming giant is well-positioned to expand beyond traditional media production and programming into a broader digital ecosystem, leveraging its massive global audience and brand recognition, the firm noted. The company's shares were up 2.7% in Tuesday trading but are down more than 24% this year. Deutsche Bank said the company's stock currently trades at 18 times its 2027 earnings-per-share estimate, down from 40 times forward EPS at its peak in June 2025. "However, at 18x, we believe the current (still very healthy) growth outlook is being undervalued, leaving room for multiple expansion to the low-to-mid 20x range, on top of 23% EPS growth in 2027," Kraft added. Netflix is capable of leveraging AI across content production, user personalization, and targeted advertising more effectively than legacy media rivals due to its technology-native origins, the note showed. "Artificial intelligence is more friend than foe for Netflix," Kraft wrote. In July, the company posted second-quarter revenue less than Wall Street's estimates and narrowed full-year sales guidance. The company is scheduled to report third-quarter results Oct. 20. Walt Disney (DIS) reported a fiscal third-quarter earnings beat last month despite revenue falling short of expectations even after a boost from "Toy Story 5." Media and connectivity giant Comcast's (CMCSA) earnings per share declined year over year in the second quarter due to an unfavorable 2025 comparison, which was boosted by gains from the Hulu sale. Price: 70.94, Change: +1.71, Percent Change: +2.47