Netflix (NFLX - Free Report) shares have surged over 40% since late September to rest near their 52-week highs. More recently, the streaming TV stock has popped over 17% in 2020, amid the coronavirus market selloff.
Netflix stock has easily outpaced Apple (AAPL - Free Report) , Microsoft (MSFT - Free Report) , and Amazon (AMZN - Free Report) , as well as the S&P 500’s 3% decline in 2020. NFLX has, for the most part, been able to stay above the coronavirus selloff because its business model is almost tailor-made for the current conditions.
Netflix doesn’t face supply chain issues and streaming TV is perfect as more and more people are either forced or choose to stay at home. Other work-from-home style stocks such as Slack (WORK - Free Report) and Zoom Video Communications (ZM - Free Report) are also up big in 2020.
Wall Street is still worried that Disney (DIS - Free Report) , Comcast (CMCSA - Free Report) , and AT&T (T - Free Report) will hurt NFLX’s long-term growth prospects. Yet Netflix beat its own fourth subscriber estimates and it is still by far the largest streaming TV company in the world, with 167 million global users and counting.
Netflix does face real competition from Disney+ and others, but the cord cutting revolution might just be getting started. In fact, roughly 56 million households will have canceled cable or satellite TV subscriptions by 2023, according to eMarketer. This is set to benefit NFLX, Roku (ROKU - Free Report) , and many other streaming-focused firms.
Looking ahead, our Zacks estimates call for Netflix’s adjusted 2020 earnings to climb 47% to $6.06 per share. Meanwhile, its fiscal 2020 revenue is projected to jump 21% to reach $24.4 billion.
NFLX is currently a Zacks Ranks #2 (Buy) and might be worth considering at the moment.
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