This article first appeared on GuruFocus.

Netflix (NFLX) shares fell about 4% in Friday premarket trading after Wells Fargo turned bearish on the streaming giant, warning that weakening engagement and a softer content slate could pressure future growth and margins.

Analyst Steven Cahall downgraded Netflix to Underweight from Hold and cut his price target to $57 from $80.

Engagement trends look worrying to us, Cahall said.

Netflix shares have already fallen about 20% year to date, but Wells Fargo sees further downside as viewing trends deteriorate.

The key concern is how much time subscribers are spending on the platform.

Cahall expects hours…