Netflix (NASDAQ:NFLX) Trading Down 2% – Here’s What Happened

Netflix, Inc. (NASDAQ:NFLX)’s share price traded down 2% during trading on Thursday . The stock traded as low as $79.28 and last traded at $79.84. Approximately 27,024,009 shares traded hands during trading, a decline of 39% from the average daily volume of 43,988,418 shares. The stock had previously closed at $81.46.

Key Netflix News

Here are the key news stories impacting Netflix this week:

• Positive Sentiment: Bill Ackman’s Pershing Square reportedly added approximately 13.1 million Netflix shares, making NFLX one of the hedge fund’s new concentrated holdings. The move may bolster investor confidence in Netflix’s valuation and long-term earnings potential. Bill Ackman portfolio overhaul article
• Positive Sentiment: Analysts and market commentators point to Netflix’s rapidly expanding advertising business, a potential $3 billion advertising revenue opportunity, continued global expansion and margin growth as catalysts for a possible recovery toward $100 and beyond. Record share buybacks could further support earnings per share. Netflix stock price prediction article
• Positive Sentiment: Netflix is being described as an undervalued long-term holding, with bullish arguments centered on double-digit revenue growth, free-cash-flow generation and the ability to monetize live events and lower-priced ad-supported plans. Netflix five-year outlook article
• Neutral Sentiment: The Netflix preview of Grand Theft Auto VI attracted significant online attention and traffic, but the immediate stock-market beneficiary appears to be Take-Two Interactive, the game’s publisher, rather than Netflix. GTA 6 Netflix preview article
• Negative Sentiment: Some analysts argue that Netflix’s growth is moderating and that Alphabet offers stronger diversification, advertising exposure and valuation. Recent commentary also identifies resistance near $82 and muted enthusiasm following the latest earnings report. NFLX versus GOOGL article
• Negative Sentiment: Reported insider activity remains a potential overhang: executives and directors made numerous sales and no purchases over the past six months. Investors may interpret the selling as reduced insider conviction, although it may also reflect routine diversification. Netflix ad monetization and market resistance article

Analyst Ratings Changes

Several research analysts have issued reports on NFLX shares. KeyCorp reiterated an “overweight” rating and set a $92.00 target price (down from $115.00) on shares of Netflix in a report on Monday, July 13th. Bank of America reissued a “buy” rating and set a $125.00 price objective on shares of Netflix in a report on Monday, May 18th. BMO Capital Markets reissued an “outperform” rating on shares of Netflix in a research note on Friday, August 14th. Raymond James Financial restated a “market perform” rating on shares of Netflix in a report on Thursday, May 14th. Finally, Jefferies Financial Group lowered their target price on Netflix from $128.00 to $110.00 and set a “buy” rating for the company in a report on Wednesday, June 10th. Four research analysts have rated the stock with a Strong Buy rating, thirty-three have assigned a Buy rating, seventeen have issued a Hold rating and one has assigned a Sell rating to the company. According to MarketBeat, the stock currently has an average rating of “Moderate Buy” and an average target price of $103.19.

Netflix Price Performance

The firm has a market cap of $340.28 billion, a PE ratio of 25.72, a price-to-earnings-growth ratio of 1.00 and a beta of 1.52. The company has a quick ratio of 1.14, a current ratio of 1.14 and a debt-to-equity ratio of 0.39. The stock has a 50 day moving average price of $74.65 and a two-hundred day moving average price of $84.33.

Netflix (NASDAQ:NFLX) last posted its quarterly earnings results on Thursday, July 16th. The Internet television network reported $0.80 earnings per share (EPS) for the quarter, topping analysts’ consensus estimates of $0.79 by $0.01. The business had revenue of $12.56 billion during the quarter, compared to analysts’ expectations of $12.58 billion. Netflix had a net margin of 28.22% and a return on equity of 40.02%. The business’s quarterly revenue was up 13.4% on a year-over-year basis. During the same quarter last year, the company posted $0.72 earnings per share. As a group, equities analysts expect that Netflix, Inc. will post 3.59 earnings per share for the current year.

Insider Buying and Selling at Netflix

In other news, CEO Gregory K. Peters sold 27,312 shares of the company’s stock in a transaction on Thursday, August 6th. The shares were sold at an average price of $73.54, for a total value of $2,008,524.48. Following the sale, the chief executive officer directly owned 120,931 shares of the company’s stock, valued at $8,893,265.74. This represents a 18.42% decrease in their position. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is accessible through the SEC website. Also, CFO Spencer Adam Neumann sold 9,248 shares of the business’s stock in a transaction on Monday, August 10th. The shares were sold at an average price of $75.79, for a total transaction of $700,905.92. Following the transaction, the chief financial officer owned 73,787 shares of the company’s stock, valued at $5,592,316.73. This represents a 11.14% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. In the last 90 days, insiders sold 600,295 shares of company stock worth $49,056,671. Corporate insiders own 1.24% of the company’s stock.

Hedge Funds Weigh In On Netflix

A number of hedge funds have recently bought and sold shares of the business. Pacific Sun Financial Corp lifted its holdings in Netflix by 1.6% during the third quarter. Pacific Sun Financial Corp now owns 574 shares of the Internet television network’s stock valued at $688,000 after purchasing an additional 9 shares in the last quarter. Beaird Harris Wealth Management LLC increased its stake in shares of Netflix by 9.6% during the third quarter. Beaird Harris Wealth Management LLC now owns 114 shares of the Internet television network’s stock worth $137,000 after purchasing an additional 10 shares in the last quarter. Monograph Wealth Advisors LLC raised its position in shares of Netflix by 1.8% during the 2nd quarter. Monograph Wealth Advisors LLC now owns 682 shares of the Internet television network’s stock worth $913,000 after purchasing an additional 12 shares during the last quarter. Resources Management Corp CT ADV lifted its stake in Netflix by 2.0% in the 2nd quarter. Resources Management Corp CT ADV now owns 829 shares of the Internet television network’s stock valued at $1,110,000 after buying an additional 16 shares in the last quarter. Finally, Sompo Asset Management Co. Ltd. lifted its stake in Netflix by 1.4% in the 2nd quarter. Sompo Asset Management Co. Ltd. now owns 1,500 shares of the Internet television network’s stock valued at $2,009,000 after buying an additional 20 shares in the last quarter. Hedge funds and other institutional investors own 80.93% of the company’s stock.

Netflix Company Profile

Netflix, Inc (NASDAQ: NFLX) is a global entertainment company that provides subscription-based streaming of films, television series, documentaries and other video content. Founded in 1997 by Reed Hastings and Marc Randolph and headquartered in Los Gatos, California, the company began as a DVD-by-mail rental service and introduced streaming video in 2007. Netflix later expanded into producing and distributing original programming, beginning notable original hits in the 2010s, and now operates a content production and distribution ecosystem alongside its licensing activity.

The company’s primary product is its on-demand streaming service, which can be accessed on a wide range of internet-connected devices and delivered through a suite of apps and web platforms.