William Blair analyst Ralph Schackart upgraded shares of Netflix, Inc. (NASDAQ:NFLX) from Market Perform to Outperform. While Schackart’s bear case implies a $110 overall valuation, his bull case pegs the price at $185.

While Schackart acknowledges there might be domestic subscription concerns arising from the most recent quarter, he has confidence in Netflix’s vast, younger audience of over 70 million users who are on the precipice of transitioning to ages “at which they become more likely to pay for Netflix.” Even with a 3% conversion rate from young, non-payers to new subscribers could garner the online streaming giant 5.3 million domestic subscriptions by the year 2020.

The analyst’s survey evaluates in particular the age groups with more propensity to pay, and Schackart’s results reveal that between the age ranges of 15 to 19 and 25 to 29, the percentage of existing Netflix users who will pay for their own account jumps up by almost 60%.

Schackart comments, “While price increases have been volatile periods for Netϐlix shares (on average the stock has sold off around 10% following increases), we believe the long-term risk/reward is favorable. Our 2020 subscriber base case results in a potential value per share near $145.”

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Additionally, Schackart’s research indicates that Netflix with just under 600 exclusive, original content review scores across the span of eight networks will be the giant’s key to differentiating itself from its peers. For Schackart, Netflix could gain $2 billion to $3 billion in annual revenue if it could only put a halt to password sharing. Ultimately, the analyst sees the stock has “oversold in the near term,” and has faith that its “original content will only gain steam” moving forward, placing the company in a position of upside stock potential.

As usual, we like to include the analyst’s track record when reporting on analyst news to give a perspective on the effect it has on stock performance. According to TipRanks, four-star analyst Ralph Schackart is ranked #474 out of 4,127 analysts. Schackart has a 62% success rate and realizes 11.3% in his annual returns.

TipRanks analytics exhibit NFLX as a Buy. Based on 31 analysts polled in the last 3 months, 17 rate a Buy on NFLX, 10 maintain a Hold, while 4 issue a Sell. The consensus price target stands at $108.68, which represents a 14% upside from where the stock is currently trading.