Back to top

Image: Bigstock

Netflix (NFLX) Rises Higher Than Market: Key Facts

Read MoreHide Full Article

Netflix (NFLX - Free Report) closed the latest trading day at $675.83, indicating a +0.96% change from the previous session's end. The stock outpaced the S&P 500's daily gain of 0.77%. Meanwhile, the Dow gained 0.49%, and the Nasdaq, a tech-heavy index, added 0.95%.

Prior to today's trading, shares of the internet video service had gained 7.77% over the past month. This has outpaced the Consumer Discretionary sector's loss of 1.38% and the S&P 500's gain of 3.71% in that time.

Investors will be eagerly watching for the performance of Netflix in its upcoming earnings disclosure. The company's upcoming EPS is projected at $4.70, signifying a 42.86% increase compared to the same quarter of the previous year. Meanwhile, the latest consensus estimate predicts the revenue to be $9.53 billion, indicating a 16.36% increase compared to the same quarter of the previous year.

For the annual period, the Zacks Consensus Estimates anticipate earnings of $18.31 per share and a revenue of $38.7 billion, signifying shifts of +52.2% and +14.75%, respectively, from the last year.

Investors should also take note of any recent adjustments to analyst estimates for Netflix. These latest adjustments often mirror the shifting dynamics of short-term business patterns. Therefore, positive revisions in estimates convey analysts' confidence in the company's business performance and profit potential.

Our research reveals that these estimate alterations are directly linked with the stock price performance in the near future. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, which varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.08% higher. Netflix is currently sporting a Zacks Rank of #1 (Strong Buy).

From a valuation perspective, Netflix is currently exchanging hands at a Forward P/E ratio of 36.55. This expresses a premium compared to the average Forward P/E of 7.93 of its industry.

Investors should also note that NFLX has a PEG ratio of 1.45 right now. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. Broadcast Radio and Television stocks are, on average, holding a PEG ratio of 0.85 based on yesterday's closing prices.

The Broadcast Radio and Television industry is part of the Consumer Discretionary sector. This group has a Zacks Industry Rank of 80, putting it in the top 32% of all 250+ industries.

The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow NFLX in the coming trading sessions, be sure to utilize

See More Zacks Research for These Tickers

Normally $25 each - click below to receive one report FREE:

Netflix, Inc. (NFLX) - free report >>

Published in