Netflix Eyes Strong Earnings Growth Amid Strategic Market Moves
With a robust market capitalization of $400.2 billion, Netflix, Inc. (NFLX) stands as a leader in the global streaming industry. Providing a vast array of TV shows, movies, and unique original content, Netflix operates under a subscription model and is accessible in over 190 countries. The company is pushing for growth by investing heavily in exclusive content, extending its reach into gaming, and implementing innovative pricing strategies, including an ad-supported tier. Anticipation is building as Netflix prepares to announce its first-quarter earnings after market hours on Thursday, April 17.
Analysts Anticipate Positive Earnings
Prior to the earnings announcement, analysts predict that Netflix will report an adjusted profit of $5.74 per share, reflecting an 8.7% increase from the $5.28 per share earned in the same quarter last year. Historically, Netflix has a strong track record of exceeding Wall Street’s earnings expectations, having surpassed estimates in each of the last four quarters. The most recent quarterly adjusted EPS reported was $4.27, which beat analyst forecasts by 1.7%.
Future Earnings Projections
Looking ahead to fiscal 2025, Netflix’s adjusted EPS is projected to increase by 24% year-over-year, from $19.83 in fiscal 2024 to $24.58. Furthermore, analysts expect earnings growth to continue into fiscal 2026, with an anticipated 20.7% increase year-over-year, bringing it to $29.66 per share.
Stock Performance and Analyst Ratings
Over the last year, NFLX stock has surged by 45.6%, significantly outperforming the S&P 500 Index’s 3.6% returns and the Communication Services Select Sector SPDR Fund’s (XLC) 11.7% increase during the same period.
Recently, Netflix shares climbed 3.7% following an upgrade by MoffettNathanson analyst Robert Fishman, who changed the recommendation from “Neutral” to “Buy” and raised the price target from $850 to $1,100. Fishman believes that the market undervalues Netflix’s potential to monetize its large user base through advertising and advancements in technology. He projects ad revenue growth at a 37% compound annual growth rate (CAGR), estimating it will exceed $10 billion by 2030, which could enhance profit margins and overall earnings.
Consensus and Price Target Insights
The overall consensus on NFLX stock remains optimistic, holding a “Moderate Buy” rating. Among the 43 analysts monitoring the stock, 28 have rated it as a “Strong Buy,” two indicate “Moderate Buy,” 12 suggest a “Hold,” and one analyst recommends a “Moderate Sell.”
The average price target of $1,084.54 suggests a potential upside of 18.3% from current trading levels.
On the date of publication, Kritika Sarmah did not hold any positions, either directly or indirectly, in any of the securities mentioned in this article. All data provided in this article is for informational purposes only. For further details, please refer to the Barchart Disclosure Policy here.
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