The streaming momentum continues. Even giant Netflix will see ongoing growth, according to Pivotal Research Group analyst Jeffrey Wlodarczak.
His latest target price for Netflix is $650 a share, underscored by the big surge in users during the pandemic. The dynamics of streaming video will be sustained even with some price increases.
Pivotal is also upbeat about Disney+, given its strong children and family-friendly appeal. That large niche audience could entice users to prefer it to traditional TV. In addition, Disney+ can benefit from the declining pay TV business due to “ever increasing price, commercials [ad] loads and seemingly waning interest in sports,” it notes.
Streamers’ ongoing popularity also benefits Amazon Prime Video and Apple TV+ — especially given their parent companies. “SVOD and given OTT products are not their core business [and] they may be willing to generate material losses in the video business,” writes Wlodarczak. That breathing room is particularly helpful to Apple TV+, giving it time room to grow.
In addition, a dual commitment to original content has won audiences, for example, the popularity of Amazon’s Emmy-winning “The Marvelous Mrs. Maisel.”
These findings complement Digital TV Research’s forecast. SVOD subscribers in the U.S. are expected to see a healthy uptick. The researcher predicts they will rise from 203 million in 2019 to 317 million in 2025.
The growth will be led by new streamers, such as Disney+ (+27 million) and Hulu (+22 million), as well as Peacock (+11 million), HBO Max (+12 million) and CBS All Access/Paramount+ (+12.2 million), which will each add more subscribers than Netflix.
Wlodarczak predicts Netflix will add 2.5 million subscribers in the third quarter — up around 60 percent from its gains in Q3 2019.