After soaring more than 4,000% over the past decade, Netflix's (NASDAQ:NFLX) shares are poised for even more gains in the year ahead. So says RBC Capital Markets, which has a 12-month $420 per-share target price for Netflix's stock.

RBC analyst Mark Mahaney sees a massive growth opportunity ahead for the streaming leader in international markets, where Netflix is facing less competition. "NFLX's International position may actually be stronger than its U.S. position given weaker all-in entertainment options in most markets," Mahaney said. 

A person in a business suit pointing to an upwardly sloping line chart

Netflix's international growth could drive its stock sharply higher in 2020. Image source: Getty Images.

Mahaney sees Netflix's scale as a powerful competitive advantage. RBC notes that the streaming giant's 158 million international subscribers are approximately five times that of its closest challenger. With more subscribers, the streaming giant is better able to spread its content costs over a larger revenue base than its smaller rivals. "Netflix is the leading global streaming player ... in a business where scale matters," Mahaney said. 

Additionally, content production costs are often far lower in international markets. This is an important factor, as Netflix is projected to spend more than $15 billion on content this year, and rising content costs are a major risk to the company's long-term success.

And while its costs are lower in international markets, Netflix's customer satisfaction scores are higher. "Our extensive survey work has consistently shown higher satisfaction scores among Netflix customers in International markets (U.K., France, Germany, Brazil, Japan) than in the U.S.," Mahaney said. 

Due in part to these reasons, RBC predicts that Netflix will eventually generate profit margins in its international segments that are on par with that of its core U.S. business. "We believe International could actually be as or more profitable than the U.S.," Mahaney said. 

All told, RBC forecasts that Netflix's international profits will grow to $1.6 billion in 2019, up from $662 million in 2018.

More bullish commentary

Other analysts have also issued bullish forecasts for Netflix in recent days.

Pivotal Research analyst Jeffrey Wlodarczak reiterated his buy rating and boosted his target price for Netflix's shares from $400 to $425 on Thursday. Wlodarczak appreciated Netflix's decision to provide investors with a more detailed breakdown of its subscriber metrics. He's also forecasting that Netflix will enjoy strong growth in international markets, to the tune of 8 million new customers in the fourth quarter of 2019 and a total of 27 million in 2020. 

Meanwhile, Goldman Sachs analyst Heath Terry reiterated his "conviction buy" rating and $400 price target on Netflix. Terry, too, argues that Netflix's recently released subscriber data show that the streaming leader has a larger opportunity for growth than many investors currently expect. "We continue to believe that consensus expectations for Netflix subscriber growth and related financials in 2020 and beyond are too low," Terry said.