BTIG Research analyst Richard Greenfield doesn’t seem like one to move the goalposts. When Netflix, Inc. (NASDAQ:NFLX) exceeded the target price he set for the company, he downgraded the firm’s stock to Neutral. That demonstrates a great deal of confidence in his older valuation of the company, and a belief that Netflix, Inc. (NASDAQ:NFLX)’s price growth has topped out.

Netflix

Shares in Netflix, Inc. (NASDAQ:NFLX) are down today after setting an all-time high of $314.18 yesterday. The company has seen massive growth in its value over 2013, led by a belief among investors that the company’s original content and growth in the United States would cause incredible growth in the company.

How far can Netflix go?

Mr. Greenfield says that Netflix, Inc. (NASDAQ:NFLX) is trading at around 31 times the firm’s expected 2015 earnings numbers, and 26.8 times if international losses are removed. That price adds in a huge amount of expected future growth, and it is in no way clear that Netflix can double its business in the next year or two.

When a stock is valued like this, it is trading on pure momentum, and it is a pure growth stock. The fundamentals no longer matter and investors are not buying in because they think the fundamentals of the firm are strong. They are buying in because they think the stock will go up. That’s dangerous all around, and the risks are getting more pronounced as stock feels the pressure of QE tapering.

The market has gone along with that sentiment today, sending shares down more than 1% percent to $303.06 at time of writing. Today’s trading is likely a reaction to the exuberance of yesterday, but that doesn’t mean it will go away tomorrow. Investors have been justifying higher and higher prices for Netflix, Inc. (NASDAQ:NFLX) stock because they want the stock price to grow. Greenfield is not playing that game.

Removing a Netflix price target

Greenfield had previously put his target price on the shares at $250. He has now removed his price target from the shares because of the absurd out-performance. Greenfield clearly doesn’t think Netflix, Inc. (NASDAQ:NFLX) shares are being valued rationally. He’s put an end to his numerical valuation of the company.

Greenfield is doing what a lot of investors can’t do in a bubble: get out before the burst. Netflix, Inc. (NASDAQ:NFLX) analysts have been causing a price target bubble for a while. Greenfield is leaving the pitch.