Netflix (NASDAQ:NFLX) Shares Down 1.5% on Analyst Downgrade

Key Points

• Wolfe Research cut its price target on Netflix to $121 from $139 while maintaining an outperform rating, and shares fell about 1.5% to roughly $93.77, trading well below the average analyst target.
• Insider selling was heavy: CEO Gregory Peters sold 20,270 shares and insiders sold about 1,619,840 shares worth ~$181.65M over the last quarter, leaving insiders with just 1.37% ownership.
• Analysts retain a consensus of "Moderate Buy" with an average price target of $130.51, and Netflix recently posted a big EPS beat ($5.87 vs. $0.69) while slightly missing revenue estimates ($11.32B vs. $11.52B).

Netflix, Inc. (NASDAQ:NFLX - Get Free Report) was down 1.5% during mid-day trading on Monday after Wolfe Research lowered their price target on the stock from $139.00 to $121.00. Wolfe Research currently has an outperform rating on the stock. Netflix traded as low as $93.53 and last traded at $93.77. Approximately 39,571,227 shares changed hands during mid-day trading, a decline of 3% from the average daily volume of 40,788,094 shares. The stock had previously closed at $95.19.

Other equities research analysts have also issued research reports about the company. KGI Securities upgraded Netflix from a "neutral" rating to an "outperform" rating and set a $135.00 price target for the company in a research note on Monday, November 3rd. BMO Capital Markets reissued an "outperform" rating on shares of Netflix in a research note on Monday, December 8th. Evercore ISI reissued an "outperform" rating and issued a $138.00 price target on shares of Netflix in a report on Friday, December 5th. Pivotal Research downgraded Netflix from a "buy" rating to a "hold" rating and dropped their price target for the stock from $160.00 to $105.00 in a research note on Monday, December 8th. Finally, Moffett Nathanson reiterated a "buy" rating on shares of Netflix in a research report on Wednesday, November 12th. Two investment analysts have rated the stock with a Strong Buy rating, twenty-nine have assigned a Buy rating, thirteen have issued a Hold rating and one has assigned a Sell rating to the stock. According to data from MarketBeat, Netflix presently has a consensus rating of "Moderate Buy" and an average price target of $130.51.

Insider Activity at Netflix

In other news, insider Cletus R. Willems sold 2,380 shares of the company's stock in a transaction dated Thursday, November 6th. The shares were sold at an average price of $110.03, for a total transaction of $261,878.54. The sale was disclosed in a legal filing with the SEC, which is available through this link. Also, CEO Gregory K. Peters sold 20,270 shares of the stock in a transaction dated Tuesday, November 4th. The shares were sold at an average price of $109.57, for a total transaction of $2,220,943.36. Following the completion of the transaction, the chief executive officer directly owned 127,810 shares of the company's stock, valued at approximately $14,003,886.08. The trade was a 13.69% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. Insiders have sold 1,619,840 shares of company stock valued at $181,648,613 over the last quarter. 1.37% of the stock is currently owned by insiders.

Institutional Investors Weigh In On Netflix

A number of hedge funds and other institutional investors have recently added to or reduced their stakes in NFLX. Optima Capital LLC lifted its holdings in Netflix by 3.5% during the second quarter. Optima Capital LLC now owns 239 shares of the Internet television network's stock worth $320,000 after buying an additional 8 shares during the period. Unified Investment Management lifted its stake in shares of Netflix by 1.7% during the 2nd quarter. Unified Investment Management now owns 474 shares of the Internet television network's stock worth $635,000 after purchasing an additional 8 shares during the last quarter. Plancorp LLC boosted its position in Netflix by 0.6% during the second quarter. Plancorp LLC now owns 1,278 shares of the Internet television network's stock valued at $1,711,000 after purchasing an additional 8 shares in the last quarter. Five Oceans Advisors grew its stake in Netflix by 1.1% in the second quarter. Five Oceans Advisors now owns 751 shares of the Internet television network's stock valued at $1,006,000 after purchasing an additional 8 shares during the last quarter. Finally, Old Port Advisors raised its holdings in Netflix by 1.3% in the second quarter. Old Port Advisors now owns 624 shares of the Internet television network's stock worth $836,000 after purchasing an additional 8 shares in the last quarter. 80.93% of the stock is currently owned by hedge funds and other institutional investors.

Netflix Price Performance

The company has a debt-to-equity ratio of 0.56, a current ratio of 1.33 and a quick ratio of 1.33. The firm has a market capitalization of $397.33 billion, a P/E ratio of 39.17 and a beta of 1.71. The stock's fifty day simple moving average is $110.58 and its 200 day simple moving average is $118.29.

Netflix (NASDAQ:NFLX - Get Free Report) last issued its quarterly earnings data on Tuesday, October 21st. The Internet television network reported $5.87 EPS for the quarter, beating the consensus estimate of $0.69 by $5.18. Netflix had a return on equity of 41.86% and a net margin of 24.05%.The firm had revenue of $11.32 billion during the quarter, compared to analyst estimates of $11.52 billion. During the same quarter in the prior year, the business posted $0.54 EPS. The business's revenue for the quarter was up 17.2% compared to the same quarter last year. Netflix has set its Q4 2025 guidance at 5.450-5.450 EPS. On average, equities research analysts predict that Netflix, Inc. will post 24.58 EPS for the current year.

Netflix Company Profile

Netflix, Inc provides entertainment services. It offers TV series, documentaries, feature films, and games across various genres and languages. The company also provides members the ability to receive streaming content through a host of internet-connected devices, including TVs, digital video players, TV set-top boxes, and mobile devices.

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