Netflix (NASDAQ:NFLX) Stock Price Down 4.7% – What’s Next?

Netflix, Inc. (NASDAQ:NFLX) shares were down 4.7% during mid-day trading on Friday . The stock traded as low as $70.11 and last traded at $71.79. Approximately 113,504,702 shares changed hands during trading, an increase of 164% from the average daily volume of 42,965,824 shares. The stock had previously closed at $75.31.

More Netflix News

Here are the key news stories impacting Netflix this week:

• Positive Sentiment: Evercore maintained a bullish stance, describing Netflix’s recent weakness as a potential entry point. Separately, Bill Ackman’s Pershing Square has established a new position, signaling confidence in the company’s long-term prospects. Evercore wants investors to buy Netflix stock
• Positive Sentiment: Netflix continues investing in advertising, live events and sports, while its ad business and aggressive share repurchases could provide longer-term support. Management also remains open to acquiring additional international NFL rights. Netflix content chief defines event strategy
• Neutral Sentiment: Netflix, Amazon and YouTube formed a coalition to advocate for technology-neutral streaming and sports-rights regulations. The initiative could improve the industry’s regulatory environment, but it is unlikely to affect near-term earnings. Netflix joins a new streaming policy coalition
• Negative Sentiment: Wells Fargo downgraded NFLX to Underweight from Equal Weight and cut its price target to $57 from $80, implying substantial downside from recent trading levels. Analyst Steven Cahall said a quick recovery is unlikely. Netflix downgraded by Wells Fargo
• Negative Sentiment: The downgrade cited approximately 4% lower second-half viewership and more than 20% weaker viewing for Netflix’s top 100 original titles. Analysts warned that fewer breakout hits, rising churn risk and weaker engagement could pressure margins and cause investors to apply a lower valuation multiple. Netflix shares fall as Wells Fargo turns bearish
• Negative Sentiment: Coverage also highlighted competitive pressure from Disney, Netflix’s need to produce another global breakout hit, and potential costs associated with sports and other new formats. These concerns are driving the view that its core streaming momentum is weakening.

Analyst Upgrades and Downgrades

Several equities analysts have commented on NFLX shares. Itau BBA Securities lowered their target price on shares of Netflix from $151.40 to $96.00 and set an “outperform” rating on the stock in a research note on Wednesday, August 5th. CICC Research cut their price target on Netflix from $110.00 to $90.00 and set an “outperform” rating for the company in a research note on Tuesday, July 21st. Rothschild & Co Redburn dropped their target price on shares of Netflix from $120.00 to $93.00 and set a “buy” rating on the stock in a report on Tuesday, July 21st. Guggenheim set a $75.00 price target on shares of Netflix and gave the company a “buy” rating in a report on Friday, July 17th. Finally, China Intl Cap raised Netflix to a “strong-buy” rating in a report on Tuesday, July 21st. Four equities research analysts have rated the stock with a Strong Buy rating, thirty-four have given a Buy rating, fifteen have given a Hold rating and two have given a Sell rating to the company’s stock. Based on data from MarketBeat, the stock presently has an average rating of “Moderate Buy” and an average price target of $95.99.

Netflix Stock Down 4.7%

The company has a current ratio of 1.14, a quick ratio of 1.14 and a debt-to-equity ratio of 0.39. The firm’s 50 day simple moving average is $75.85 and its 200-day simple moving average is $84.21. The stock has a market capitalization of $298.93 billion, a price-to-earnings ratio of 22.60, a price-to-earnings-growth ratio of 1.08 and a beta of 1.53.

Netflix (NASDAQ:NFLX) last posted its quarterly earnings results on Thursday, July 16th. The Internet television network reported $0.80 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 return on equity of 40.02% and a net margin of 28.22%.Netflix’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. Equities analysts expect that Netflix, Inc. will post 3.59 earnings per share for the current fiscal year.

Insiders Place Their Bets

In other Netflix news, CEO Gregory Peters sold 27,312 shares of the business’s stock in a transaction on Thursday, August 6th. The shares were sold at an average price of $73.54, for a total transaction of $2,008,524.48. Following the sale, the chief executive officer owned 120,931 shares of the company’s stock, valued at approximately $8,893,265.74. The trade was a 18.42% decrease in their ownership of the stock. The transaction was disclosed in a filing with the SEC, which can be accessed through the SEC website. Also, CEO Theodore Sarandos sold 27,312 shares of the company’s stock in a transaction that occurred on Tuesday, August 4th. The shares were sold at an average price of $73.35, for a total transaction of $2,003,335.20. Following the completion of the transaction, the chief executive officer owned 178,954 shares of the company’s stock, valued at approximately $13,126,275.90. This trade represents a 13.24% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Insiders sold a total of 179,045 shares of company stock valued at $13,132,194 over the last ninety days. 1.24% of the stock is owned by insiders.

Institutional Investors Weigh In On Netflix

Hedge funds have recently added to or reduced their stakes in the company. BlackRock Inc. bought a new stake in Netflix during the second quarter worth $24,902,221,000. Geode Capital Management LLC grew its position in shares of Netflix by 892.0% during the 4th quarter. Geode Capital Management LLC now owns 99,598,678 shares of the Internet television network’s stock valued at $9,305,336,000 after acquiring an additional 89,558,684 shares during the period. Capital World Investors raised its holdings in shares of Netflix by 859.1% in the 4th quarter. Capital World Investors now owns 89,341,444 shares of the Internet television network’s stock worth $8,376,656,000 after purchasing an additional 80,025,890 shares during the period. Norges Bank purchased a new position in shares of Netflix during the 4th quarter valued at $5,803,248,000. Finally, Invesco Ltd. increased its stake in shares of Netflix by 835.9% in the fourth quarter. Invesco Ltd. now owns 43,462,696 shares of the Internet television network’s stock worth $4,075,062,000 after purchasing an additional 38,818,947 shares in the last quarter. Institutional investors and hedge funds own 80.93% of the company’s stock.

About Netflix

Netflix, Inc (NASDAQ:NFLX) is a global entertainment company that provides subscription-based streaming access to television series, films, documentaries and other video content. Its service includes Netflix-produced and licensed programming, with offerings that may vary by market. The company also provides an advertising-supported plan in selected countries and has expanded into mobile games and other interactive entertainment.

Netflix was founded in 1997 by Reed Hastings and Marc Randolph as a DVD-by-mail rental service in the United States.