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Netflix (NFLX) disappointed the Street in its latest quarterly statement. Shares sunk after investors were left underwhelmed by the quarter’s lackluster global subscriber additions.

That’s not to say Q3 was all bad.

Netflix posted a beat on the top line with revenue increasing by 22.7% year-over-year to $6.44 billion, ahead of Wall Street’s forecast by $60 million. However, the streaming giant missed on the bottom line, posting GAAP EPS of $1.74, $0.39 below the estimates.

The all-important new subscriber count appears to have disappointed the most. Netflix’ guidance was for 2.5 million new additions in the quarter, a cautious figure keeping a lid on the Street’s expectation for 5 million new adds. In the end, the figure came in below the guidance, and at 2.2 million paid net adds, was also significantly below the 6.8 million reported in the same quarter last year.

For 4Q20, Netflix is expecting 6 million new additions, a 32% drop from the 8.8 million who subscribed to the service in 4Q19.

For Deutsche Bank analyst Bryan Kraft, however, the latest results are of little concern.  The 5-star analyst tells investors to simply “buy the dip” and said, “We would be buyers of the weakness in Netflix shares.”

The analyst highlights several positives to take away from the results, including better than expected FCF (free cash flow) for 2020 and 2021, higher ARPU (average revenue per user) than anticipated in most regions, efficiencies in content and marketing spend and the restarts of production of several popular titles such as Stranger Things: Season 4, The Witcher: Season 2, and the Ryan Reynolds, Dwayne Johnson and Gal Gadot movie, Red Notice.

Summing up, Kraft said, “Expectations for y/y subscriber growth in the first half of 2021 are already muted given the difficult comparison; therefore, we do not believe that commentary regarding y/y net add declines in 1H21 before returning to normal pre-COVID levels should come as a surprise or disappointment. Netflix remains a long-term secular growth story, and maintains its lead amongst SVOD competitors, particularly in terms of global scale. We believe the company will continue to create content customers want worldwide, which will provide healthy subscriber growth and sustainable pricing power.”

There’s no change to Kraft’s rating which stays a Buy, while the $570 price target remains, too. Investors are looking at 17.5% of upside from current levels. (To watch Kraft’s track record, click here)

The Street’s overall enthusiasm for Netflix hasn’t diminished, either. Based on 21 Buys, 5 Holds and 3 Sells, the stock has a Moderate Buy consensus rating. Almost identical to Kraft’s, the $572.92 average price target, suggest shares will appreciate by 18% over the coming months. (See Netflix stock analysis on TipRanks)

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Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.