Wedbush Provides Optimistic Earnings Forecast for Netflix

On October 15th, 2024, research analysts from Wedbush upgraded their earnings per share (EPS) estimates for Netflix, Inc. (NASDAQ:NFLX). Analyst A. Reese now predicts that the popular streaming service will achieve an EPS of $6.84 for the first quarter of 2026, a slight increase from the previous estimate of $6.83. The firm has maintained an "Overweight" rating for Netflix and set a price target of $775.00 for the stock, indicating a positive outlook on its future performance. For the current financial year, the consensus EPS estimate for Netflix stands at $19.08.

Netflix last reported its quarterly earnings on July 18th, when it announced an EPS of $4.88. This figure exceeded the consensus estimate of $4.74 by $0.14. In the same quarter, Netflix showcased a net margin of 19.54% and a return on equity of 32.93%. The company generated revenue of $9.56 billion during the quarter, surpassing analysts' expectations of $9.53 billion. Compared to the same quarter the previous year, Netflix’s revenue rose by 16.8%, while the EPS increased from $3.29.

In addition to Wedbush, other research firms have also weighed in on Netflix’s stock. Notably, Morgan Stanley raised its price target for Netflix from $820.00 to $830.00, affirming an "overweight" rating in a report published on Friday. Goldman Sachs has set a target price of $750.00 for Netflix, while Sanford C. Bernstein increased its target from $625.00 to $780.00, maintaining a "market perform" rating. Loop Capital also raised its price target from $750.00 to $800.00, labeling the stock as a "buy." Citigroup adjusted its target up from $660.00 to $675.00, recommending a "neutral" rating. Overall, the stock has received two sell ratings, nine hold ratings, and an impressive twenty-six buy ratings, leading to an average rating of "Moderate Buy" with a price target of $739.38 according to MarketBeat.

Current Stock Performance and Metrics

As of last Friday, Netflix shares (NASDAQ:NFLX) opened at $763.89. The stock has seen a fifty-two week low of $392.26 and a high of $766.28, revealing its volatility in recent months. With a market capitalization of $329.24 billion, Netflix's price-to-earnings ratio stands at 53.01, and the company exhibits a PEG ratio of 1.49 alongside a beta of 1.26. Netflix’s financial health is also showcased by its debt-to-equity ratio of 0.55 and liquidity ratios of 0.95.

Insider Trading Activity

Recent insider trading activities at Netflix included Chairman Reed Hastings selling 25,599 shares on August 1st at an average price of $631.43, resulting in a total transaction value of approximately $16.16 million. Post-transaction, Hastings retained just 57 shares, valued at $35,991.51. This sale reflected no significant change in his position. On a similar note, insider David A. Hyman sold 20,656 shares on August 6th, accumulating around $12.50 million from the sale. Overall, insiders have sold approximately 225,167 shares, valued at about $150.49 million over the past three months, with insiders holding about 1.76% of the company's shares.

Institutional Investors and Trading Changes

In the institutional space, various hedge funds have adjusted their positions in Netflix. Massmutual Trust Co. FSB ADV increased its holdings by 7.8%, now owning 1,191 shares worth $723,000. Similarly, Perpetual Ltd saw a significant jump of 216.8% in its Netflix shares, reaching a total of 3,054 shares valued at $1.85 million. American National Bank and Park Avenue Securities also saw significant increases in their holdings. At present, institutional investors own about 80.93% of Netflix stock, showcasing strong institutional support.

About Netflix

Netflix, Inc. provides a wide range of entertainment services, encompassing TV series, documentaries, feature films, and video games across various genres and languages. With a focus on streaming content, Netflix enables its members to enjoy its extensive library through a multitude of internet-connected devices.

Netflix, Earnings, Forecast