After a sell-off cut its value by a third, Netflix represents one of the most compelling investments available in the internet space, according to Goldman Sachs.

The brokerage reiterated its buy rating on Netflix shares as well as its $400, 12-month price target, representing nearly 50 percent upside from the stock's close on Thursday. Goldman also added the internet video platform to its so-called "Conviction List," a hand-picked collection of stocks its analysts believe are more likely than others to deliver meaningful upside.

"With Netflix shares down 36 percent since record highs in July, and the S&P 500 down 10 percent over the same period, we believe Netflix represents one of the best risk/reward propositions in the Internet sector," analyst Heath Terry said in a note Friday. "We continue to believe Netflix's investment in content, technology and distribution will continue to drive subscriber growth well above consensus expectations both in the U.S. and internationally."

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