As on-demand video streaming giant Netflix Inc. (NFLX) has seen its stock rally 42% this year, analysts at Piper Jaffray are the latest to issue a bullish note forecasting the global media company’s momentum to continue as it expands its reach in international markets and posts better-than-expected subscriber growth.

Netflix -- one of the market’s best-performing stocks -- has gained almost 82% in the last 12 months while the Nasdaq 100 index has increased 24%. (See also: Netflix Is a Buy as it Reaches ‘Escape Velocity’.)

Success Without Low-Income Segment?

In a recent research note, Piper Jaffray analyst Michael Olson predicts that Los Gatos, Calif.-based Netflix will grow its global subscriber base to 100 million in three years. Olson reiterated an outperform rating on NFLX shares, lifting his price target to $215 from $198, expecting some 24% upside from current levels.

"International growth is clearly the primary focus of NFLX investors; one of the most consistent concerns we hear, regarding ongoing growth potential, is the challenge the service will face gaining adoption in lower income markets," wrote Olson in a note to clients on Tuesday. "Our analysis suggests that Netflix can reach 100M international subs by 2020, with zero or very minimal penetration in lower income international markets."

Based on a number of scenarios wherein Olson foresees the streaming video company reaching 100 million subscribers by 2020, the analyst indicates his estimate “could still be conservative.” The analyst wrote that if Netflix attains just a quarter of the upper-income segment in international markets (above $18,600 per year), it can reach the 100 million mark with no share of the lower-income demographic. His analysis completely left out China penetration. In the most recent quarter, Netflix got a major boost after reporting 5.2 million new subscribers versus the consensus for 3.2 million. (See also: Netflix Skyrockets on Major Subscriber Gain.)

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