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Netflix (NFLX) shares are down roughly 10% at the time of writing after the streaming giant recorded disappointing earnings for its third quarter primarily because of a Brazilian tax dispute. The company’s quarterly revenue came in line with Street estimates but its per-share earnings of $5.87 missed expectations by more than a dollar. Including the post-earnings decline, Netflix stock is down more than 15% versus its June high. Should You Buy the Dip in Netflix Stock? Despite the earnings miss, NFLX stock is worth buying on the post-earnings weakness especially since management said artificial intelligence (AI) presents a “significant opportunity” for the mass media giant. There have been lingering concerns that AI-generated content could prove a headwind for Netflix and its creative workforce. According to Ted Sarandos, the firm’s chief executive, however, “AI can’t automatically make you a great storyteller if you’re not.” On the earnings call, he dubbed artificial intelligence a boon for content optimization, operational efficiency, ad revenue, and the overall recommendation algorithms. That made Morgan Stanley reiterate its “Overweight” rating on Netflix shares today. In his research note, the firm’s analyst Benjamin Swinburne raised the price target as well to $1,500, indicating potential upside of nearly 35% from here. Where Options Data Suggests NFLX Shares Are Headed Options traders are also pricing in further upside in NFLX shares through the remainder of 2025. According to Barchart, contracts expiring Jan. 16 currently indicate potential upside to roughly $1,231. In the near-term as well, the expected move through the end of next week is 3.87% with the upper bound pegged at $1,162 – albeit with downside risk to $1,075. Upside is more likely to play out in Netflix stock also because “margins outperformed in the third quarter and engagement trends are improving,” according to Swinburne. Plus, continued momentum in the company’s ad business – on course to more than double in 2025 – could drive its share price higher through the remainder of this year as well. Wall Street Remains Bullish on Netflix Other Wall Street firms are also largely positive on Netflix shares heading into 2026. The consensus rating on NFLX stock sits at “Moderate Buy” with the mean target of roughly $1,339 indicating potential upside of nearly 20% from here.