Netflix (NASDAQ:NFLX) Stock Price Up 1.7% - Time to Buy?

Key Points

• Netflix shares rose 1.7% to $73.63, but remain below their 50-day and 200-day moving averages after a post-earnings decline.
• Second-quarter revenue slightly missed estimates and weaker third-quarter guidance raised concerns that Netflix’s rapid growth is slowing, despite an EPS beat and 13.4% year-over-year revenue growth.
• Analyst sentiment remains broadly positive but mixed, with a consensus “Moderate Buy” rating and $103.48 average price target; potential catalysts include live content, advertising, AI efficiencies and possible Canadian tax relief.

Shares of Netflix, Inc. (NASDAQ:NFLX - Get Free Report) rose 1.7% during mid-day trading on Wednesday . The stock traded as high as $73.74 and last traded at $73.63. 43,249,703 shares changed hands during trading, a decline of 6% from the average daily volume of 45,946,273 shares. The stock had previously closed at $72.39.

Netflix News Roundup

Here are the key news stories impacting Netflix this week:

• Positive Sentiment: Netflix’s selective live-content strategy is reportedly increasing sign-ups, engagement and advertising opportunities. Management’s use of sports, events and other live programming could provide additional growth without requiring a broad shift away from its content strategy. Netflix's Live Content Push: Can it Sustain Subscriber Growth?
• Positive Sentiment: Several market commentators argue that the post-earnings selloff has made Netflix more attractive, citing its lower valuation, strong fundamentals, continued share buybacks and potential for artificial intelligence to improve content and operating efficiency. Netflix Is Betting Billions That AI Will Strengthen Its Business
• Positive Sentiment: Netflix recently edged the BBC as the first choice among U.K. viewers, reinforcing the broader shift toward streaming and supporting the company’s international reach. Netflix Just Knocked the BBC Off Its Throne
• Positive Sentiment: Canada appears set to scrap a levy affecting entertainment companies such as Netflix, potentially reducing regulatory and content-related costs in that market. Netflix Tax Will Soon Be Scrapped
• Neutral Sentiment: Analysts remain divided: one CNBC commentator recommended Netflix, while an Erste Group analyst maintained a Hold rating and slightly lowered the firm’s FY2027 EPS estimate to $3.82 from $3.84. Netflix on CNBC’s Final Trades
• Negative Sentiment: Netflix’s second-quarter revenue came in below Wall Street expectations, and weaker third-quarter guidance overshadowed otherwise solid results. The reports have renewed concerns that the company’s era of rapid growth is ending. Netflix: The Days of Rapid Growth Are Over
• Negative Sentiment: Netflix is viewed less favorably than Roku in a comparison of ad-supported streaming stocks because Roku has raised guidance, a more diversified platform model and a lower valuation premium. NFLX vs. ROKU: Which Ad-Supported Streaming Stock Has an Edge Now?

Analysts Set New Price Targets

Several research firms have recently commented on NFLX. Wedbush reduced their target price on Netflix from $118.00 to $105.00 and set an "outperform" rating for the company in a research note on Friday, July 17th. Citigroup lowered shares of Netflix from a "buy" rating to a "positive" rating in a research note on Monday, July 20th. Phillip Securities raised shares of Netflix from a "moderate buy" rating to a "strong-buy" rating in a report on Sunday, July 19th. BMO Capital Markets downgraded shares of Netflix from an "outperform" rating to a "market perform" rating in a research note on Monday, July 20th. Finally, Barclays decreased their price objective on shares of Netflix from $85.00 to $80.00 and set an "equal weight" 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 issued a Hold rating and one has issued a Sell rating to the company's stock. Based on data from MarketBeat, Netflix currently has a consensus rating of "Moderate Buy" and an average target price of $103.48.

Netflix Stock Performance

The stock's 50-day moving average price is $77.61 and its 200-day moving average price is $85.74. The company has a current ratio of 1.14, a quick ratio of 1.14 and a debt-to-equity ratio of 0.39. The company has a market capitalization of $306.59 billion, a P/E ratio of 23.18, a P/E/G ratio of 0.88 and a beta of 1.52.

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

Insider Activity at Netflix

In other news, CEO Gregory K. Peters sold 27,312 shares of the company's stock in a transaction that occurred on Thursday, May 7th. The stock was sold at an average price of $88.69, for a total transaction of $2,422,301.28. Following the completion of the transaction, the chief executive officer directly owned 120,931 shares of the company's stock, valued at approximately $10,725,370.39. This represents a 18.42% 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, CEO Theodore A. Sarandos sold 27,312 shares of the stock in a transaction that occurred on Tuesday, May 5th. The stock was sold at an average price of $87.97, for a total value of $2,402,636.64. Following the sale, the chief executive officer owned 284,804 shares in the company, valued at $25,054,207.88. The trade was a 8.75% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. The sale was made to cover tax withholding obligations related to the vesting of equity awards. In the last three months, insiders sold 899,839 shares of company stock valued at $80,141,661. 1.24% of the stock is owned by insiders.

Institutional Investors Weigh In On Netflix

Several large investors have recently added to or reduced their stakes in NFLX. Checchi Capital Advisers LLC boosted its stake in Netflix by 875.7% during the fourth quarter. Checchi Capital Advisers LLC now owns 31,143 shares of the Internet television network's stock valued at $2,920,000 after buying an additional 27,951 shares in the last quarter. BNC Wealth Management LLC grew its holdings in Netflix by 991.3% during the fourth quarter. BNC Wealth Management LLC now owns 41,229 shares of the Internet television network's stock worth $3,866,000 after acquiring an additional 37,451 shares during the period. Crew Capital Management Ltd raised its position in Netflix by 1,021.9% in the fourth quarter. Crew Capital Management Ltd now owns 9,031 shares of the Internet television network's stock worth $847,000 after acquiring an additional 8,226 shares in the last quarter. Family Capital Trust Co raised its position in Netflix by 20,869.5% in the fourth quarter. Family Capital Trust Co now owns 27,470 shares of the Internet television network's stock worth $2,576,000 after acquiring an additional 27,339 shares in the last quarter. Finally, Vanguard Group Inc. lifted its holdings in Netflix by 912.5% in the 4th quarter. Vanguard Group Inc. now owns 390,014,981 shares of the Internet television network's stock valued at $36,567,805,000 after acquiring an additional 351,493,659 shares during the last quarter. 80.93% of the stock is owned by institutional investors and hedge funds.

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.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.