Goldman Sachs Cuts Netflix Price Target on Engagement Concerns

Goldman Sachs has adjusted its outlook on Netflix, reducing its price target from $94 to $90 while keeping a Buy rating. Despite this downgrade, Netflix's stock remains significantly below the new target, trading at $67.50, near its 52-week low of $65.08. The stock has dropped 42% over the past year, yet analysts suggest it is undervalued, trading below its Fair Value.

The firm cited concerns over user growth and engagement ahead of Netflix’s third-quarter 2026 earnings report, scheduled for October 20. Data from Sensor Tower shows a 20% year-over-year decline in U.S. time spent on Netflix and a 7% global decrease. Additionally, Netflix’s share of total viewing time dropped from 47% to 46%, while its U.S. TV viewership share fell from 8.8% to 7.8% over the last twelve months.

Goldman Sachs attributed these engagement pressures to seasonality, content slate shifts, and a move toward international and local language titles. As a result, the firm lowered its revenue outlook for 2027 and beyond. However, other analysts remain optimistic, with TD Cowen reiterating a Buy rating and a $100 price target, expecting over 10% revenue growth and improving margins.

Deutsche Bank upgraded Netflix to a Buy rating from Hold, citing undervaluation in its international business, despite lowering its price target to $95 from $100. Guggenheim also raised its price target to $80, highlighting Netflix’s valuation compared to peers like Alphabet and Meta. These mixed perspectives reflect the company’s strategic initiatives as it prepares for its upcoming earnings report.