(Bloomberg) -- It’s safe to say Morgan Stanley didn’t see Netflix Inc.’s subscriber surge coming.

The bank raised its price estimate for the stock to $475 a share from $450 on Wednesday, after the U.S. streaming giant smashed analyst expectations for new user additions in the third quarter. Just a day earlier, in preparation for Netflix’s quarterly earnings report Tuesday, Morgan Stanley had cut the price target for the first time in three months, to $450 a share from $480.

The third-quarter outperformance “reminds us that the long-term trend is clear,” analysts including Benjamin Swinburne wrote in a note, saying Netflix reported almost 1 million more net paid additions than they had expected.

Expansion into new program genres like self-produced romantic comedies and unscripted TV, as well as growth in new geographies like India and broader Asia, suggests 2019 could be even better, the analysts added, reiterating their outperform recommendation.

To contact the reporters on this story: Joe Easton in London at jeaston7@bloomberg.net;James Cone in London at jcone@bloomberg.net

To contact the editors responsible for this story: Beth Mellor at bmellor@bloomberg.net, Tom Lavell, Blaise Robinson

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