Netflix NFLX closed at $358.98 in the latest trading session with a -1.61% move from the previous day. This decrease was lower than the S&P 500’s gain of 0.88%, while the Dow dropped 0.11% and the tech-heavy Nasdaq lost 3.76%.
Before the recent trading period, stocks of the video streaming service had advanced 13.61% in the past month, beating the 4.88% loss of the Consumer Discretionary sector, and the 0.38% loss of S&P 500 in the same duration.
With its following earnings release, Netflix is hoping to show strength. The company is anticipated to report earnings of $2.80 per share on that day, representing a year-over-year decrease of 12.5%. On the other hand, our newest consensus estimate predicts a revenue of $8.25 billion which is a 3.47% increase from the previous-year quarter.
For this year, our Zacks Consensus Estimates forecast earnings of $11.19 per share and revenue of $33.77 billion, which reflects changes of +12.46% and +6.8%, respectively, from the prior year.
Investors should also note any new modifications to analyst projections for Netflix, as these alterations commonly reflect the latest short-term business trends that are subject to change frequently. Hence, investors can interpret positive prediction revisions as a good signal for the company’s business outlook.
From our research, we believe these estimate revisions are connected to recent stock movements, and investors can profit from this information by using the Zacks Rank. This rating system charges the stocks from #1 (Strong Buy) to #5 (Strong Sell) based on these estimate modifications, and has acquired an impressive, audited track record of success, with #1 stocks giving an average annual return of +25% since 1988. Within the previous 30 days, our consensus EPS projection has inclined 0.67% higher, and at present, Netflix is holding a Zacks Rank of #3 (Hold).
Looking into valuation, Netflix has a present Forward P/E ratio of 32.6, indicating a premium contrasted to the Broadcast Radio and Television industry’s average Forward P/E of 11.71.
Netflix’s PEG ratio is 1.45 at present. This metric functions similarly to the common P/E ratio, but it considers the stock’s anticipated earnings growth rate as well. The Broadcast Radio and Television industry presently has a typical PEG ratio of 1.4 as of the last close.
The Broadcast Radio and Television industry is a component of the Consumer Discretionary sector, which presently has a Zacks Industry Rank of 120, positioning it in the top 48% of over 250 industries.
The Zacks Industry Rank evaluates the power of the individual industry groups by estimating the average Zacks Rank of the individual stocks in the group. Our studies reveal that the highest 50% rated industries exceed the bottom half by a ratio of 2 to 1.
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