![]() ![]() Overall, Netflix’s earnings report and discussion “portrayed a company that was more surprised by things and less clear than ever about the path forward,” Nathanson wrote. “We question how easy that would be in a world where everyone wants to take share in the market by spending more on content,” Nathanson observed. The company acknowledged intensifying competition - and told investors it expects to grow share of viewing while decelerating growth in spending on content. Netflix’s disclosure that over 100 million freeloaders (including 30 million in the U.S./Canada) are mooching off someone else’s account “is further evidence that the product has hit maturity in key markets,” MoffettNathanson principal analyst Michael Nathanson wrote in a note. ![]() the current great consumer experience and introduces ad volatility to results.” Wlodarczak is bearish on Netflix’s plan to offer a cheaper, ad-supported tier - calling that a net negative, because “we believe it cheapens the brand and the product vs. “The NFLX flywheel has slowed substantially, and it will take time to get it going again, which is likely to create substantial uncertainty around the name for at least the balance of ’22.” ![]() The Netflix Q1 report exacerbates investor concerns that “streaming appears nearly fully penetrated globally post-COVID,” the analyst added. “After what can only be called a shocking 1Q subscriber miss and weak subscriber and financial guidance we reduced our subscriber forecasts and pushed back our profitability forecasts substantially,” Wlodarczak wrote in a note to clients. And we’re super focused on achieving those objectives and getting back into our investors’ good graces.”Ĭlick here to sign up for Variety’s free Strictly Business newsletter covering earnings, financial and investment news, and more.Īfter the earnings misfire, Pivotal Research Group analyst Jeff Wlodarczak cut his rating on the stock to from “buy” to “sell” and chopped his 12-month price target by almost 60%, to $235 per share. “But internally, we’re really geared up, and this is like our moment to shine. “I know it’s disappointing for investors, and it is for sure,” Hastings said on Netflix’s Q1 video interview Tuesday. To try to right the ship, Netflix is aiming to convert freeloading password-users into subscribers and to roll out a lower-cost, ad-supported tier over the next two years. Its industry sports an average Forward P/E of 12.48, so we one might conclude that Netflix is trading at a premium comparatively.Among other factors, co-CEO Reed Hastings blamed the subscriber shrinkage on “great competition” and the company’s estimate that more than 100 million households are streaming the service using a shared password without paying for it. Looking at its valuation, Netflix is holding a Forward P/E ratio of 36.21. Netflix is currently sporting a Zacks Rank of #3 (Hold). Within the past 30 days, our consensus EPS projection has moved 0.41% lower. It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system. Our research shows that these estimate changes are directly correlated with near-term stock prices. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook. These recent revisions tend to reflect the evolving nature of short-term business trends. Investors might also notice recent changes to analyst estimates for Netflix. Meanwhile, our latest consensus estimate is calling for revenue of $8.24 billion, up 3.4% from the prior-year quarter.įor the full year, our Zacks Consensus Estimates are projecting earnings of $11.14 per share and revenue of $33.77 billion, which would represent changes of +11.96% and +6.82%, respectively, from the prior year. On that day, Netflix is projected to report earnings of $2.79 per share, which would represent a year-over-year decline of 12.81%. Wall Street will be looking for positivity from Netflix as it approaches its next earnings report date. ![]() Heading into today, shares of the internet video service had gained 21.84% over the past month, outpacing the Consumer Discretionary sector's loss of 2.05% and the S&P 500's gain of 3.56% in that time. At the same time, the Dow added 0.03%, and the tech-heavy Nasdaq gained 5.73%. This change lagged the S&P 500's 0.24% gain on the day. In the latest trading session, Netflix (NFLX) closed at $399.29, marking a -1.05% move from the previous day. ![]()
0 Comments
Leave a Reply. |