Netflix (NASDAQ:NFLX) Shares Down 3.5% - What's Next?

Key Points

• Netflix's stock price dropped by 3.5% to $1,201.13, with trading volume significantly lower than average, indicating potential market volatility.
• Despite the recent stock decline, analysts show optimism with a consensus target price of $1,297.66 and multiple reports upgrading Netflix's rating to "outperform."
• Recent insider trading activity saw CFO Spencer Neumann and Director Reed Hastings sell significant shares, leading to a reported decrease in their ownership stakes within the company.

Netflix, Inc. (NASDAQ:NFLX - Get Free Report)'s stock price fell 3.5% during mid-day trading on Tuesday . The stock traded as low as $1,192.79 and last traded at $1,201.13. 1,697,939 shares traded hands during mid-day trading, a decline of 59% from the average session volume of 4,149,810 shares. The stock had previously closed at $1,245.09.

Wall Street Analysts Forecast Growth

NFLX has been the subject of a number of research analyst reports. Robert W. Baird increased their price target on Netflix from $1,300.00 to $1,500.00 and gave the company an "outperform" rating in a research report on Monday, July 21st. Morgan Stanley reaffirmed an "equal weight" rating on shares of Netflix in a research report on Monday, July 21st. BMO Capital Markets reissued an "outperform" rating and issued a $1,425.00 target price (up from $1,200.00) on shares of Netflix in a research report on Tuesday, July 15th. Loop Capital reissued a "hold" rating on shares of Netflix in a research report on Tuesday, July 15th. Finally, Macquarie boosted their price target on Netflix from $1,150.00 to $1,200.00 and gave the company an "outperform" rating in a report on Monday, April 21st. One investment analyst has rated the stock with a Strong Buy rating, twenty-two have given a Buy rating, ten have issued a Hold rating and three have assigned a Sell rating to the company. According to data from MarketBeat, the company presently has a consensus rating of "Moderate Buy" and a consensus target price of $1,297.66.

Netflix Price Performance

The company has a current ratio of 1.34, a quick ratio of 1.34 and a debt-to-equity ratio of 0.58. The stock has a market capitalization of $514.94 billion, a PE ratio of 51.54, a price-to-earnings-growth ratio of 2.09 and a beta of 1.59. The firm has a 50 day moving average price of $1,231.65 and a 200 day moving average price of $1,105.79.

Netflix (NASDAQ:NFLX - Get Free Report) last announced its quarterly earnings data on Thursday, July 17th. The Internet television network reported $7.19 earnings per share (EPS) for the quarter, topping the consensus estimate of $7.07 by $0.12. The business had revenue of $11.08 billion during the quarter, compared to the consensus estimate of $11.04 billion. Netflix had a net margin of 24.58% and a return on equity of 42.50%. The firm's quarterly revenue was up 15.9% compared to the same quarter last year. During the same quarter last year, the firm earned $4.88 earnings per share. Netflix has set its FY 2025 guidance at EPS. Q3 2025 guidance at 6.870-6.870 EPS. Research analysts anticipate that Netflix, Inc. will post 24.58 earnings per share for the current year.

Insider Activity

In other Netflix news, CFO Spencer Adam Neumann sold 2,601 shares of Netflix stock in a transaction on Tuesday, July 1st. The shares were sold at an average price of $1,307.22, for a total value of $3,400,079.22. Following the transaction, the chief financial officer directly owned 3,691 shares of the company's stock, valued at approximately $4,824,949.02. The trade was a 41.34% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which can be accessed through the SEC website. Also, Director Reed Hastings sold 26,933 shares of Netflix stock in a transaction on Monday, June 2nd. The stock was sold at an average price of $1,211.66, for a total transaction of $32,633,638.78. Following the sale, the director owned 394 shares of the company's stock, valued at $477,394.04. The trade was a 98.56% decrease in their ownership of the stock. The disclosure for this sale can be found here. Insiders sold a total of 146,307 shares of company stock valued at $179,443,809 over the last three months. Company insiders own 1.37% of the company's stock.

Hedge Funds Weigh In On Netflix

Large investors have recently made changes to their positions in the stock. Vanguard Group Inc. lifted its stake in shares of Netflix by 1.0% in the second quarter. Vanguard Group Inc. now owns 38,379,084 shares of the Internet television network's stock valued at $51,394,583,000 after purchasing an additional 381,824 shares during the period. State Street Corp lifted its stake in shares of Netflix by 2.1% in the second quarter. State Street Corp now owns 17,444,013 shares of the Internet television network's stock valued at $23,359,801,000 after purchasing an additional 360,604 shares during the period. Price T Rowe Associates Inc. MD lifted its stake in shares of Netflix by 2.7% in the first quarter. Price T Rowe Associates Inc. MD now owns 11,732,066 shares of the Internet television network's stock valued at $10,940,505,000 after purchasing an additional 304,399 shares during the period. Geode Capital Management LLC lifted its stake in shares of Netflix by 2.4% in the second quarter. Geode Capital Management LLC now owns 9,926,733 shares of the Internet television network's stock valued at $13,234,278,000 after purchasing an additional 229,182 shares during the period. Finally, GAMMA Investing LLC lifted its stake in shares of Netflix by 109,524.3% in the first quarter. GAMMA Investing LLC now owns 8,835,722 shares of the Internet television network's stock valued at $8,239,576,000 after purchasing an additional 8,827,662 shares during the period. 80.93% of the stock is currently owned by institutional investors and hedge funds.

About Netflix

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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