Netflix is a video streaming service headquartered in Los Gatos, California. Founded in 1997 by Marc Randolph and Reed Hastings, Netflix offers streaming access to TV series, documentaries, feature films and mobile games.
As of September 2023, Netflix is one of the world’s most popular video streaming services, with more than 238 million paying members in more than 190 countries.
April 19, 2024: Netflix stock slid as much as 9.6% Friday after the company gave a second quarter revenue forecast that missed estimates and announced it would stop reporting quarterly subscriber metrics closely watched by Wall Street, according to Yahoo Finance.
April 5, 2024: Pivotal Research analysts maintained a Buy rating on Netflix, with an updated price target of $765 (up from $700), according to Benzinga.
March 27, 2024: Wedbush analyst Michael Pachter maintained an Outperform rating on Netflix, with an updated price target of $725 (up from $615), according to Benzinga.
Netflix reported better-than-expected first-quarter results after blowout subscriber growth, but the streaming giant forecast weaker-than-expected revenue for the current quarter amid expectations for slower net additions in Q2.
For the second quarter, the company forecast EPS of $4.68 on revenue of $9.49B, compared with Wall Street estimates of $4.55 on revenue of $9.5B, but also cautioned that paid net additions would slow sequentially in Q2.
"We expect paid net additions to be lower in Q2’24 vs. Q1’24 due to typical seasonality," Netflix said, though added that average revenue per membership, to be up year-over-year in Q2.
Looking further ahead, the company forecast revenue growth of 13% to 15%, on operating margin of 25%, up from a prior forecast of 24%.
The company also said it would stop reporting quarterly membership numbers and average revenue per membership starting next year with its Q1 2025 earnings, as it believes revenue and operating margin are its key performance measures, according to Investing.com.
Only you can make the decision on the time to leap... but here's some supporting information and analysis.
Over the last 12 months, Netflix's shares have ranged in value from as little as $315.62 up to $639. A popular way to gauge a stock's volatility is its "beta".
Beta is a measure of a share's volatility in relation to the market. The market (NASDAQ average) beta is 1, while Netflix's is 1.218. This would suggest that Netflix's shares are a little bit more volatile than the average for this exchange and represent, relatively-speaking, a slightly higher risk (but potentially also market-beating returns).
Historical closes compared with the last close of $564.8
| 1 week (2024-04-18) | -7.49% |
|---|---|
| 1 month (2024-03-25) | -9.99% |
| 3 months (2024-01-25) | 0.50% |
| 6 months (2023-10-25) | 37.34% |
| 1 year (2023-04-25) | 75.10% |
| 2 years (2022-04-25) | 169.07% |
| 3 years (2021-04-23) | 11.72% |
| 5 years (2019-04-25) | 53.34% |
The gauge below shows real-time ratings that are based on 26 popular indicators such as moving averages, for specific time periods. It's not a recommendation but is simply technical analysis that can form part of your research.
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Valuing a stock is incredibly difficult, and any metric has to be viewed as part of a bigger picture of overall performance. However, analysts commonly use some key metrics to help gauge value. Check out the Netflix P/E ratio, PEG ratio and EBITDA
Netflix's current stock price divided by its per-share earnings (EPS) over a 12-month period gives a "trailing price/earnings ratio" of roughly 40x. In other words, Netflix stocks trade at around 40x recent earnings.
That's relatively high compared to, say, the trailing 12-month P/E ratio for the United States stock markets on average as of November 10, 2023 (20.44). The high P/E ratio could mean that investors are optimistic about the outlook for the shares or simply that they're over-valued.
Netflix's "price/earnings-to-growth ratio" can be calculated by dividing its P/E ratio by its growth – to give 1.7203. A PEG ratio over 1 can be interpreted as meaning shares are overvalued at the current rate of growth, or may anticipate an acceleration in growth.
The PEG ratio provides a broader view than just the P/E ratio, as it gives more insight into Netflix's future profitability. By accounting for growth, it could also help you if you're comparing the stock prices of multiple high-growth companies.
Netflix's EBITDA (earnings before interest, taxes, depreciation and amortisation) is a whopping $8.2 billion.
The EBITDA is a measure of a Netflix's overall financial performance and is widely used to measure a its profitability.
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