Streaming powerhouse Netflix Inc (NASDAQ:NFLX) is declining rapidly this morning, last seen down 9.2% at $97.87, after the company reported lackluster current-quarter guidance and said co-founder Reed Hastings will be leaving in June. This news is overshadowing an otherwise impressive first-quarter beat of $1.23 per share on revenue of $12.3 billion.
No fewer than six analysts have slashed their price target in response, the lowest adjustment coming from Rosenblatt Securities to $95. Analysts leaned bullish toward Netflix stock ahead of today, with just 12 of the 49 in coverage sporting a "hold" rating.
NFLX has unsurprisingly made its way onto the short sale restricted (SSR) list, now on track to snap a seven-day win streak and log its worst day since Oct. 22. The shares are clinging to just above the year-to-date breakeven level, with today's pullback captured by the 120-day moving average.
The equity sports a 10-day call/put volume ratio of 2.57 at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX). This ratio sits higher than 88% of annual readings.
Options traders have been quick to respond, with 588,000 calls and 303,000 puts across the tape so far, volume that is six times the average intraday rate. Most popular looks to be the April 100 call, with positions being opened there, which expire after the close.
Plus, Netflix stock's Schaeffer's Volatility Scorecard (SVS) comes in at 70 out of 100. In other words, shares have consistently realized higher-than-expected volatility in the past 12 months.
