In the latest trading session, Netflix (NFLX) closed at $84.61, marking a +2.31% move from the previous day. This change outpaced the S&P 500's 0.54% loss on the day. On the other hand, the Dow registered a gain of 0.03%, and the technology-centric Nasdaq decreased by 1.18%.
The internet video service's stock has dropped by 2.29% in the past month, exceeding the Consumer Discretionary sector's loss of 2.3% and lagging the S&P 500's gain of 0.58%.
The upcoming earnings release of Netflix will be of great interest to investors. The company is predicted to post an EPS of $0.76, indicating a 15.15% growth compared to the equivalent quarter last year. At the same time, our most recent consensus estimate is projecting a revenue of $12.17 billion, reflecting a 15.42% rise from the equivalent quarter last year.
NFLX's full-year Zacks Consensus Estimates are calling for earnings of $3.12 per share and revenue of $51.19 billion. These results would represent year-over-year changes of +23.32% and +13.3%, respectively.
Any recent changes to analyst estimates for Netflix should also be noted by investors. Such recent modifications usually signify the changing landscape of near-term business trends. Therefore, positive revisions in estimates convey analysts' confidence in the business performance and profit potential.
Our research shows that these estimate changes are directly correlated with near-term stock prices. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.
The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.03% lower within the past month. Netflix currently has a Zacks Rank of #3 (Hold).
Investors should also note Netflix's current valuation metrics, including its Forward P/E ratio of 26.47. This valuation marks a premium compared to its industry average Forward P/E of 10.84.
One should further note that NFLX currently holds a PEG ratio of 1.47. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. By the end of yesterday's trading, the Broadcast Radio and Television industry had an average PEG ratio of 1.2.
The Broadcast Radio and Television industry is part of the Consumer Discretionary sector. This industry, currently bearing a Zacks Industry Rank of 65, finds itself in the top 27% echelons of all 250+ industries.
The Zacks Industry Rank is ordered from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Keep in mind to rely on Zacks.com to watch all these stock-impacting metrics, and more, in the succeeding trading sessions.
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Netflix, Inc. (NFLX): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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