Crypto Whales Are Loading Up — Are You?
New research shows the biggest crypto buyers are back. And this time? They could hold for the possibility that Bitcoin will surpass $100,000 in 2024. You don’t want to miss the next massive crypto bull run like we saw in 2020 and 2021. To know exactly what’s going on and what to buy… Get Access To Benzinga’s Best Crypto Research and Investments For Only $1.
Netflix, Inc. (NASDAQ:NFLX) stock has more than doubled year-to-date.
The streaming platform's momentum is building ahead of a July 16 second-quarter earnings report, and the stock is trading just off its all-time closing record.
ENTER TO WIN $500 IN STOCK OR CRYPTO
Enter your email and you'll also get Benzinga's ultimate morning update AND a free $30 gift card and more!
Will the Q2 print act as a further catalyst for Netflix stock?
The Consensus Estimate
Analysts, on average, estimate Q2 earnings of 80 cents per share, a strong jump from 15 cents one year ago.
The revenue estimates of 38 analysts range between $3.92 billion and $4 billion, with the consensus at $3.94 billion, up from $2.79 billion reported in Q2 2017, according to Yahoo Finance.
Over the last 90 days, the consensus EPS estimate has moved from 65 cents to 80 cents.
In its first-quarter earnings release, Netflix guided Q2 EPS to 79 cents and revenue to $3.9 billion.
Netflix shares rose over 9 percent after the Q1 print April 16, which showed in-line top- and bottom-line results and better-than-expected net subscriber additions.
Incidentally, shares ran up modestly before the most recent quarterly report.
Key Metrics To Watch
Net adds for the domestic as well as international segments; operating margin; and non-GAAP free cash flow are among the key metrics to watch in the Q2 print.
The company's guidance envisages net subscriber adds of 6.2 million for Q2, comprising 974,000 domestic adds and 4.27 million international adds.
Imperial Capital's David Miller estimates adds of 6.11 million, with the domestic-international mix being 1.22 million and 5.05 million, respectively, while the analyst expects DVD-only membership to slip by 0.16 million.
Miller said he expects original series "Lost In The Space" and "My Next Guest Needs No Introduction" to catalyze subscriber growth.
FREE REPORT: How To Learn Options Trading Fast
In this special report, you will learn the four best strategies for trading options, how to stay safe as a complete beginner, a 411% trade case study, PLUS how to access two new potential winning options trades starting today.Claim Your Free Report Here.
Netflix should post a meaningful average selling price increase in the wake of increased subscription pricing announced in October, Miller said.
Netflix continues to expect negative free cash flow of $3 billion to $4 billion for fiscal 2018, with the cash burn likely to continue for several years due to heavy spending on original content.
Barclays analyst Kannan Venkateshwar is of the view that Netflix should to be valued on a per-subscriber basis, instead of with conventional metrics such as total addressable market, average revenue per user and churn. Yet this method needs to be adjusted for differences in respective ARPUs, churn and margin profiles, the analyst said.
"Based on this, Netflix's valuation is not too far off from legacy media businesses, which are growing significantly slower," Venkateshwar said.
The Stock
In the first half of 2018, Netflix shares gained 104 percent compared to a more modest 8.8-percent advance by the Nasdaq Composite Index and a 1.7-percent rise in the S&P 500 Index.
Source: Yahoo Finance
Barclays has an Overweight rating on Netflix with a $450 price target.
Imperial Capital has an Overweight rating and a Street-high $503 price target.
The average analysts recommendation for Netflix shares is a Buy and the average price target is $414.16, according to the Yahoo database.
In the eventuality of a pullback, the stock could find support in a consolidation zone around the $390 level.
Related Links:
Survey: More Than One-Third Of Millennials Prefer To Watch Netflix On TV Over Cable
Infographic: 5 Fun Facts About Netflix
Photo courtesy of Netflix.
Crypto Whales Are Loading Up — Are You?
New research shows the biggest crypto buyers are back. And this time? They could hold for the possibility that Bitcoin will surpass $100,000 in 2024. You don’t want to miss the next massive crypto bull run like we saw in 2020 and 2021. To know exactly what’s going on and what to buy… Get Access To Benzinga’s Best Crypto Research and Investments For Only $1.