Advisors Capital Management LLC Acquires Shares of 452,890 Netflix, Inc. $NFLX

Key Points

• Advisors Capital Management acquired 452,890 Netflix shares during the second quarter, valued at approximately $32.3 million. Institutional investors collectively own 80.93% of Netflix’s outstanding stock.
• Netflix insiders have been selling shares: a director and the CFO sold stock recently, while insiders sold approximately $49.1 million worth of shares over the past 90 days.
• Analysts maintain a generally positive outlook, with Netflix receiving a “Moderate Buy” consensus rating and an average price target of $103.48. The company’s latest quarter showed 13.4% year-over-year revenue growth and slightly exceeded EPS expectations.

Advisors Capital Management LLC purchased a new position in shares of Netflix, Inc. (NASDAQ:NFLX - Free Report) during the second quarter, according to the company in its most recent filing with the Securities & Exchange Commission. The institutional investor purchased 452,890 shares of the Internet television network's stock, valued at approximately $32,336,000.

Other institutional investors and hedge funds have also made changes to their positions in the company. Vanguard Group Inc. raised its position in shares of Netflix by 912.5% in the fourth quarter. Vanguard Group Inc. now owns 390,014,981 shares of the Internet television network's stock valued at $36,567,805,000 after buying an additional 351,493,659 shares during the last quarter. BlackRock Inc. acquired a new position in Netflix during the second quarter worth about $24,902,221,000. State Street Corp grew its stake in Netflix by 927.6% during the 4th quarter. State Street Corp now owns 176,780,995 shares of the Internet television network's stock valued at $16,574,986,000 after acquiring an additional 159,578,053 shares in the last quarter. Geode Capital Management LLC grew its stake in Netflix by 892.0% during the 4th quarter. Geode Capital Management LLC now owns 99,598,678 shares of the Internet television network's stock valued at $9,305,336,000 after acquiring an additional 89,558,684 shares in the last quarter. Finally, Capital World Investors raised its holdings in Netflix by 859.1% in the 4th quarter. Capital World Investors now owns 89,341,444 shares of the Internet television network's stock valued at $8,376,656,000 after acquiring an additional 80,025,890 shares during the last quarter. 80.93% of the stock is currently owned by hedge funds and other institutional investors.

Insider Buying and Selling

In related news, Director Bradford L. Smith sold 35,990 shares of Netflix stock in a transaction that occurred on Wednesday, June 17th. The stock was sold at an average price of $77.52, for a total value of $2,789,944.80. Following the sale, the director directly owned 79,690 shares in the company, valued at $6,177,568.80. The trade was a 31.11% decrease in their ownership of the stock. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is available through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, CFO Spencer Adam Neumann sold 9,248 shares of the company's stock in a transaction on Monday, August 10th. The stock was sold at an average price of $75.79, for a total transaction of $700,905.92. Following the transaction, the chief financial officer directly owned 73,787 shares in the company, valued at approximately $5,592,316.73. This trade represents a 11.14% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. In the last ninety days, insiders sold 600,295 shares of company stock worth $49,056,671. 1.24% of the stock is currently owned by insiders.

Wall Street Analysts Forecast Growth

NFLX has been the topic of a number of analyst reports. China Intl Cap upgraded Netflix to a "strong-buy" rating in a research report on Tuesday, July 21st. Citigroup reaffirmed a "market perform" rating on shares of Netflix in a research note on Monday. Stephens initiated coverage on Netflix in a report on Friday, July 17th. They set an "overweight" rating on the stock. Piper Sandler reissued an "overweight" rating and set a $85.00 price target (down from $115.00) on shares of Netflix in a research report on Friday, July 17th. Finally, UBS Group dropped their price objective on shares of Netflix from $130.00 to $115.00 and set a "buy" rating for the company in a report on Friday, July 17th. Four equities research analysts have rated the stock with a Strong Buy rating, thirty-three have given a Buy rating, seventeen have given a Hold rating and one has issued a Sell rating to the company. According to MarketBeat, the company currently has an average rating of "Moderate Buy" and an average price target of $103.48.

Key Headlines Impacting Netflix

Here are the key news stories impacting Netflix this week:

• Positive Sentiment: Bill Ackman’s Pershing Square rebuilt a major position. The investment firm’s purchase, despite previously taking a reported $400 million loss on Netflix, signals confidence in the company’s long-term growth, competitive position and leadership. The disclosure helped support a recent increase in NFLX shares. Netflix Moved, What Is Drawing Attention Now?
• Positive Sentiment: Analysts see advertising as a significant growth opportunity. Netflix is expanding its ad-supported business through live programming, new ad technology and additional tools for marketers. The company is targeting substantial future advertising revenue, which could diversify its sales base and support continued revenue expansion. NFLX's Ad Business Focus
• Positive Sentiment: Valuation has become more attractive after the selloff. Netflix trades at roughly 21 times forward earnings in the cited analysis, a level viewed as more reasonable than during prior periods of comparable declines. A CNBC contributor also recommended Netflix, reinforcing the bullish case among some investors. Netflix Trades at 21 Times Forward Earnings
• Neutral Sentiment: Co-founder Reed Hastings discussed Netflix’s performance-focused culture. Hastings said companies should operate as teams rather than families, making workforce reductions easier when employees do not meet expectations. The comments revisit Netflix’s 2001 layoffs but do not represent a new operating announcement. Reed Hastings Says Companies Aren’t Families
• Negative Sentiment: YouTube is reportedly trying to prevent creators from signing with Netflix. YouTube is offering creators millions of dollars and warning that simultaneous Netflix deals could jeopardize marketing support and brand-campaign revenue. This could raise Netflix’s content-acquisition costs and make it harder to secure popular creator-led programming. YouTube Offers Creators Millions to Avoid Netflix Deals
• Negative Sentiment: Netflix faces a lawsuit from the band Demon Hunter. The group alleges that Netflix’s KPop Demon Hunters infringes its rights. The case creates legal and reputational risk, although the financial impact is currently unclear. Netflix Sued by Band Demon Hunter

Netflix Price Performance

Shares of NASDAQ NFLX opened at $80.14 on Friday. The company has a debt-to-equity ratio of 0.39, a quick ratio of 1.14 and a current ratio of 1.14. Netflix, Inc. has a fifty-two week low of $65.08 and a fifty-two week high of $126.71. The firm has a market capitalization of $333.70 billion, a PE ratio of 25.23, a price-to-earnings-growth ratio of 1.01 and a beta of 1.52. The stock's 50-day simple moving average is $74.40 and its 200-day simple moving average is $84.37.

Netflix (NASDAQ:NFLX - Get Free Report) last released its quarterly earnings data on Thursday, July 16th. The Internet television network reported $0.80 earnings per share (EPS) for the quarter, beating the consensus estimate of $0.79 by $0.01. The company had revenue of $12.56 billion during the quarter, compared to the consensus estimate of $12.58 billion. Netflix had a net margin of 28.22% and a return on equity of 40.02%. Netflix's revenue for the quarter was up 13.4% on a year-over-year basis. During the same quarter in the prior year, the firm posted $0.72 earnings per share. As a group, equities research analysts forecast that Netflix, Inc. will post 3.59 EPS for the current fiscal year.

About Netflix

Netflix, Inc NASDAQ: NFLX is a global entertainment company that provides subscription-based streaming of films, television series, documentaries and other video content. Founded in 1997 by Reed Hastings and Marc Randolph and headquartered in Los Gatos, California, the company began as a DVD-by-mail rental service and introduced streaming video in 2007. Netflix later expanded into producing and distributing original programming, beginning notable original hits in the 2010s, and now operates a content production and distribution ecosystem alongside its licensing activity.

The company's primary product is its on-demand streaming service, which can be accessed on a wide range of internet-connected devices and delivered through a suite of apps and web platforms.

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