Citi analyst Jason Bazinet downgraded Netflix (NFLX) to Neutral from Buy with a price target of $325, down from $410, after taking over coverage of the name.

The stock closed Monday down $4.67 to $309.99.

The analyst says consensus estimates are too high. Over the last seven years, there is a strong historical relationship between the company's cash outlays on content and its net subscriber additions, Bazinet tells investors in a research note. However, Street forecasts "materially deviate from this long-term pattern," contends the analyst.

He believes this suggests Netflix's cash content costs need to rise, or net add forecasts need to fall. Bazinet's numbers suggest that if content costs rise, Netflix shares could fall 15%. If net add forecasts come down, the stock could fall 5%, adds the analyst.