Netflix's Stock Rises 10.8 Percent Following User Satisfaction Report
“Netflix’s competitive position continues to rise,” Citigroup analyst Mark Mahaney says.
Netflix's stock jumped 10.8 percent on Wednesday following a Citigroup analyst report that highlighted rising customer satisfaction.
Netflix shares finished Wednesday's stock market trading session at $62.58, giving the firm a market value of nearly $3.5 billion. Bloomberg News said the gain was the stock's biggest daily increase since July.
That is up from a 52-week low of $52.81 hit in August, but down sharply from Netflix's 52-week high of $133.43 set in February.
The stock is still down around 10 percent from its closing price at the end of 2011 amid perceived increased competition from Amazon.com and possible new sector players. Verizon and Redbox are expected to launch a streaming service before the end of the year.
Citigroup analyst Mark Mahaney said in a report Wednesday that the online video streaming service, led by CEO Reed Hastings, has managed to improve its customer satisfaction following a 2011 price increase and a reversed attempt to separate its online and DVD rental services.
In a survey of 3,800 Internet users conducted last month, the firm said 48 percent of users said they were “very or extremely satisfied,” up from 45 percent in the first and second quarters. And the percentage of people listing Netflix as a top destination has jumped from 25 percent in the second quarter to 35 percent in the latest survey.
Also, the perceived streaming content selection drew better marks. Thirty-seven percent believe that it has improved over the past 12 months, with only 16 percent saying it has gotten worse, the analyst found.
“Netflix’s competitive position continues to rise,” Mahaney concluded. He has a "buy" rating on the stock.