Rosenblatt's Barton Crockett explains why he is 'skeptical' of Netflix making a bid for WBD

Netflix and Warner Bros Discovery (WBD) Potential Deal - Rosenblot Securities has a buy rating and a $1530 price target on Netflix stock [1] - Analyst believes it makes sense for Netflix to explore acquiring assets from WBD to learn more about a major competitor [3] - Analyst is skeptical about Netflix acquiring WBD assets due to cultural differences between streaming-first and box office-driven strategies [3] - Analyst believes it would be difficult for Netflix to pivot to become a major box office player and gain Hollywood's trust [3][4] Challenges and Considerations - Libraries deteriorate without new production, which is often theatrically driven [5][6] - Netflix pivoting to theatrical movie production could face pushback from Hollywood [6] - Comcast may face difficulties in making a large acquisition due to challenges in its core broadband business [8] Netflix Financials and Growth - Analyst models a 28% compound annual growth rate (CAGR) in earnings per share (EPS) for Netflix over 3 years, with 2026 in the middle [8] - Analyst believes Netflix can trade at a 45x price-to-earnings (P/E) ratio, a premium to its growth, due to its dominant position and history of beating estimates [8]