Wall Street analyst says this will be the most important piece of data in Netflix earnings

Wall street is staring at for Netflix to mission extra American subscribers in 2017 than 2016, stated Mark Mahaney, managing director at RBC.

“which is clear evidence the market hasn’t matured,” Mahaney advised CNBC’s “fast cash: Halftime file” on Wednesday.

Mahaney introduced: “When the year is all said and executed, we predict [subscribers] are going to be better this yr than ultimate yr, and that’s the reason what takes the shares better.”

The collection of domestic subscribers, world subscribers within the quarter, and steerage for world subscribers will the the key metrics to be able to make or spoil Netflix shares after salary on Wednesday afternoon, Mahaney said.

Analysts expect Netflix to add 1.forty four million web home streaming subscribers and 3.seventy three million net global streaming subscribers, in step with boulevard Account consensus estimates.

Shares of the streaming service hit an all-time intra-day high of $ one hundred thirty five.40 a share on Tuesday, in advance of the income report. Mahaney said he thinks it is justified to pay $ 200 for Netflix stock within 2 years.

“Expectations are very best with this name of the entire huge cap internet names,” Mahaney said.

Netflix’s submit-cash moves had been notoriously volatile over the past 12 months. In October, the corporate’s income beat sent shares up 19 % in a day, while its July results sent shares falling 15 % after hours. In April, tepid subscriber forecasts despatched shares as a lot as 12 p.c decrease, despite better-than-anticipated income.

David Einhorn, the founding father of Greenlight Capital, stated in his annual letter to shareholders this week that Netflix “has now not confirmed that its large investment in unique content has a positive return.”

but Mahaney stated he’s bullish on Netflix’s basic prospects as a standalone company, even if the market is “extremely skeptical” of the higher end of Netflix’s lengthy-term subscriber predictions.

“however just take into accout, we’re going through this seismic shift faraway from paid television subscribers to streaming subscribers, and that’s why Amazon and different corporations are spending a lot time on this area,” Mahaney said. “Ithink Netflix is a ways and away the chief on this space.”