Netflix stock is sinking. Passwords are not the issue.

The fears that Netflix NFLX NFLX -8.41% would crackdown on password-sharing were unfounded. The new ad supported tier has also blown away any fears about subscriber growth. The company’s revenue forecast for the third quarter was lower than Wall Street had hoped. It also gave slightly less optimistic guidance. The 5.6% decline in shares Thursday morning, to $450.66 seems out of proportion, if this is the reason for people selling.

Some investors may have reacted with a knee-jerk reaction after seeing their shares double in value over the last year. Investors may have bought in anticipation of earnings and sold on the news.

Matthew Harrigan, a benchmark analyst, identified the problem before earnings were announced. He has a sell rating on the shares. However, he raised his price target from $250 to $293 on July 18th.

Netflix’s content is the only thing that makes it stand out in a streaming world where there are many other competitors. The strike of Hollywood writers and actors, therefore, is a major problem for Netflix, even though it may increase profits in the short-term. Netflix is not the only company that offers live sports and news.

Harrigan wrote that “even with Netflix’s advantage in terms of new content and overseas production, which is not affected by the U.S. shutdown,” it was possible for 2024 growth to be dampened. The level of mutual animosity in the entertainment media trade is increasing.

Netflix is a Netflix. It doesn’t seem special without new and original programming.

Other analysts are also of course in disagreement. Jeffrey Wlodarczak, of Pivotal Research Group, raised his price target from $535 to $605 after the earnings on Wednesday.

In a note he sent out on Thursday, he said: “Netflix is a very affordable and arguably underpriced entertainment product, and the management has consistently shown an ability to take price.” “We recommend that investors take advantage and increase their positions.”