Netflix (NFLX 0.24%) still has growth ahead of it, but it's not going to come easy and the "gains from here will be grinding," an analyst says.

Still, he maintained an outperform rating on the streaming giant's stock and reiterated a $655 per share price target, which indicates he believes the stock is undervalued by about 30% from where it closed yesterday.

Two smiling women on a couch. One holds a tv remote in her hand.

Image source: Getty Images.

Evercore ISI analyst Mark Mahaney told investors in a research note he surveyed some 1,700 consumers about Netflix and found more than half, or 55%, were "extremely" or "very" satisfied about the service they received from the streamer.

As good as that sounds, it's actually down from the 60% range Netflix typically receives, suggesting it is finding "some softness" in the market. With the seemingly ever-expanding choice viewers now have before them as numerous competing services launched during the pandemic, it's not surprising consumer views of Netflix would tick down.

Based on Sensor Tower data for app downloads, Mahaney thinks Netflix's guidance that it will add only 1 million net new subscribers to its service globally in the second quarter is "reasonable."

It's going to have to duke it out for new subscribers here in the U.S., but growth is not dead, while elsewhere, such as in Japan, the survey indicates Netflix is at "an "inflection in penetration" and satisfaction with the service has "surged."

Overall, he still sees Netflix as a buy and the streaming service stock still has substantial upside to it.