Credit: Shutterstock photoUntil now, most original movies from subscription video-on-demand services were modestly budgeted dramas and comedies, but Netflix ( NFLX ) on Friday raised the bar with the release of a Hollywood blockbuster-style film in "Bright."
[ibd-display-video id=3039338 width=50 float=left autostart=true] "Bright" reportedly cost $90 million to make and stars Will Smith and Joel Edgerton as cop partners in an alternate present-day where humans, orcs, elves and fairies coexist.
"It's a big-budget event movie that I think people will start seeing the potential for this original movie initiative," Netflix Chief Content Officer Ted Sarandos told Wall Street analysts on an Oct. 16 conference call. Netflix expects to release 80 original movies in 2018.
Critics aren't fond of "Bright," as the movie has only 31% positive reviews on Rotten Tomatoes as of Friday morning. However, the audience score for "Bright" stood at 88% positive.
Nevertheless, Netflix sees "Bright" as a franchise and has already ordered a sequel.
Netflix's next potential blockbuster is gangster film "The Irishman" from acclaimed director Martin Scorsese. The reported $125 million production stars Robert De Niro, Al Pacino, Joe Pesci and Harvey Keitel and is set for release in 2019.
Netflix shares climbed 0.7% to close at 189.94 on the stock market today .
IBD'S TAKE:Netflix stock has an IBD Composite Rating of 86, meaning it has outperformed 86% of stocks in key metrics over the past 12 months. For more analysis on Netflix, visit the IBD Stock Checkup .
Netflix's movie production initiative is a smart one, Wells Fargo Securities analyst Ken Sena said in a report Wednesday.
"Netflix stands to benefit from its film investment in several ways," Sena said. "Principally, we see this as a major brand push for Netflix, as a greater-than-two-times increase in their movie content pipeline next year should help to further strengthen its position among subscribers."
He added, "Second, given how fragmented film rights are globally (both by country and by window), a broader original strategy in film offers Netflix the opportunity to circumvent the need to negotiate rights on a country-by-country basis, presenting it obvious cost synergies."
Sena rates Netflix stock as outperform with a price target of 230.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
