Wells Fargo cuts Netflix rating to Underweight

On Friday, 18 September 2026, Wells Fargo downgraded Netflix to Underweight from Equal Weight. The bank warned that softening viewer engagement and a weaker content slate could pressure the streaming service's margins and valuation multiple.

Wells Fargo analyst Steven Cahall cut his price target for Netflix stock to $57, implying about 25% downside. He also lowered his valuation multiple to 15 times forward earnings from 21 times, pointing to the January viewership report due alongside fourth-quarter results as a negative catalyst.

Cahall noted that daily viewing stood at 1.6 hours per subscriber in the first half, which he estimated was down 8% compared with 2023 after adjusting for geographic mix and the crackdown on password sharing. Hours watched from its top 100 original titles fell during the period, and its share of United States television viewing dropped below 8%.

The analyst projected that second-half hours from top 100 originals will fall 21% year over year, raising cancellation risks into 2027. Consequently, Cahall trimmed his 2027 and 2028 earnings estimates to $3.77 and $4.52 per share. He acknowledged that record content spending and surprise international hits could challenge his negative outlook.