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Globe and Mail
a day ago
- Business
- Globe and Mail
ETFs to Tap Netflix's Q2 Earnings Beat, Upbeat Outlook
Netflix NFLX reported strong second-quarter 2025 results after the closing bell on Thursday. The world's largest video-streaming company outpaced earnings estimates but slightly missed on revenues. It raised its full-year revenue guidance. Shares of Netflix were down less than 1% in after-market hours. Investors seeking to tap the opportune moment should invest in ETFs with the largest allocation to this streaming giant. These funds include First Trust Dow Jones Internet Index Fund FDN, FT Vest Dow Jones Internet & Target Income ETF FDND, MicroSectors FANG+ ETN FNGS, Communication Services Select Sector SPDR Fund XLC and Invesco Next Gen Media and Gaming ETF GGME. Q2 Earnings in Detail The company reported earnings per share of $7.19, which strongly outpaced the Zacks Consensus Estimate of $7.07 and the year-ago earnings of $4.88. This marks Netflix's sixth-straight quarterly earnings beat, even though the company no longer posts subscriber numbers. Revenues rose 16% year over year to $11.08 billion and were slightly below the consensus estimate of $11.09 billion. The company remains unscathed by the ongoing tariff chaos, as the entertainment industry demonstrates its resilience in tough economic times. Netflix's low-cost advertising-supported service plan should provide it with greater resilience if the macroeconomic climate worsens (read: Tariff-Led Volatility Ahead for Big Tech? ETFs in Focus). The robust results were driven by popular Netflix programs such as Squid Game, Sirens, Ginny & Georgia, The Eternaut and Secrets We Keep, and hot movies such as Tyler Perry's Straw and Exterritorial. Netflix is optimistic heading into the second half of the year, with a standout slate. The upcoming quarters boast a robust lineup, including the second season of Wednesday, the Stranger Things finale, the Canelo-Crawford live boxing match, Adam Sandler's Happy Gilmore 2, Kathryn Bigelow's A House of Dynamite, and Guillermo del Toro's Frankenstein. For the third quarter, Netflix expects revenues to hit $11.53 billion and earnings per share to be $6.87. The guidance is above the Zacks Consensus Estimate of $11.29 billion for revenues and $6.56 for earnings per share. The streaming video giant raised its full-year revenue guidance, citing strong subscriber growth and ad sales momentum. It expects revenues to be in the range of $44.8-$45.2 billion, up from $43.5-$44.5 billion. The company launched its in-house ad tech platform on April 1, with international expansion beginning this quarter. Management expects advertising revenue growth to double in 2025, signaling confidence in this relatively new business segment. ETFs in Focus First Trust Dow Jones Internet Index Fund (FDN) First Trust Dow Jones Internet Index Fund follows the Dow Jones Internet Composite Index, giving investors exposure to the broad Internet industry. It holds about 40 stocks in its basket, with Netflix occupying the second spot at 10%. First Trust Dow Jones Internet Index Fund is the most popular and liquid ETF in the broad technology space, with AUM of $7.2 billion and an average daily volume of around 268,000 shares. FDN charges 49 bps in fees per year and has a Zacks ETF Rank #1 (Strong Buy) with a High risk outlook. FT Vest Dow Jones Internet & Target Income ETF (FDND) FT Vest Dow Jones Internet & Target Income ETF is an actively managed fund that invests primarily in U.S. exchange-traded equity securities intended to track the Dow Jones Internet Composite Index. It utilizes an "option strategy" consisting of writing (selling) U.S. exchange-traded call options on the Nasdaq-100 Index, or ETFs that track the Nasdaq-100 Index. It holds 41 stocks in its basket, with Netflix occupying the second position at 10% share. FT Vest Dow Jones Internet & Target Income ETF has accumulated $7 million in its asset base and trades in an average daily volume of about 3,000 shares. It charges 75 bps in annual fees. MicroSectors FANG+ ETN (FNGS) MicroSectors FANG+ ETN is linked to the performance of the NYSE FANG+ Index, which is an equal-dollar-weighted index. It is designed to provide exposure to a group of highly traded growth stocks of next-generation technology and tech-enabled companies. It holds 10 stocks in its basket in equal proportion, with Netflix's share coming in at 10%. MicroSectors FANG+ ETN has accumulated $483.3 million in its asset base and charges 58 bps in annual fees. It trades in a moderate volume of 104,000 shares a day on average and has a Zacks ETF Rank #3 (Hold) (read: Mag 7 ETFs Surge: Will the Rally Keep Rolling?). Communication Services Select Sector SPDR Fund (XLC) Communication Services Select Sector SPDR Fund offers exposure to companies from telecommunication services, media, entertainment and interactive media & services and has accumulated $23.5 billion in its asset base. It follows the Communication Services Select Sector Index and holds 23 stocks in its basket, with Netflix occupying the third position at 8.4% share. Communication Services Select Sector SPDR Fund charges 8 bps in annual fees and trades in an average daily volume of 6 million shares. It has a Zacks ETF Rank #2 (Buy). Invesco Next Gen Media and Gaming ETF (GGME) Invesco Next Gen Media and Gaming ETF offers exposure to companies with significant exposure to technologies or products that contribute to future media through direct revenues. It tracks the STOXX World AC NexGen Media Index, holding 93 stocks in its basket. Netflix is the third firm, accounting for 7.7% of the GGME assets. Invesco Next Gen Media and Gaming ETF has amassed $148.1 million in its asset base and charges 61 bps in annual fees. It trades in an average daily volume of 7,000 shares and has a Zacks ETF Rank #3. Want key ETF info delivered straight to your inbox? Zacks' free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week. Get it free >> Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Netflix, Inc. (NFLX): Free Stock Analysis Report MicroSectors FANG+ ETN (FNGS): ETF Research Reports Invesco Next Gen Media and Gaming ETF (GGME): ETF Research Reports
Globe and Mail
3 days ago
- Business
- Globe and Mail
Netflix Gears Up for Q2 Earnings Release: ETFs in Focus
Netflix NFLX is set to release second-quarter 2025 results on July 17 after market close. It is worth taking a look at the fundamentals of the world's largest video-streaming company ahead of its results. Netflix shares have risen about 29% over the past three months, outperforming the broader industry's growth of 25.1%. The strong trend is expected to continue, given that Netflix has a strong chance to beat earnings estimates. As a result, ETFs with the largest allocation to this streaming giant, like First Trust Dow Jones Internet Index Fund FDN, FT Vest Dow Jones Internet & Target Income ETF FDND, MicroSectors FANG+ ETN FNGS, Communication Services Select Sector SPDR Fund XLC and Invesco Next Gen Media and Gaming ETF GGME are in focus. Earnings Whispers Netflix has an Earnings ESP of +1.68% and a Zacks Rank #2 (Buy). According to our methodology, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 or 3 (Hold) increases the chances of an earnings beat. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter. The online video-streaming giant saw a negative earnings revision of a penny over the past seven days for the to-be-reported quarter. It is expected to report substantial earnings growth of 44.7% and revenue growth of 15.6% for the to-be-reported quarter. The company's earnings surprise history is impressive, as it delivered an earnings surprise of 6.94% on average over the past four quarters. Analysts Are Bullish Ahead of Earnings Analysts are bullish on Netflix, with an average brokerage recommendation (ABR) of 1.72 made by 45 brokerage firms. Out of them, 27 are Strong Buy and three are Buy. Strong Buy and Buy, respectively, account for 60% and 6.67% of all recommendations. The average price target for Netflix comes to $1,239.18, ranging from a low of $800 to a high of $1,600 (read: Tech ETFs Hit New Highs as NVIDIA Powers Market Rally). Some analysts raised the target price on the stock ahead of the earnings release. BMO Capital lifted the target price to $1,425 from $1,200, reflecting growing confidence in the streaming giant's near and long-term growth prospects. BMO's upward revision was driven by record-breaking viewership for "Squid Game 3," along with favorable foreign exchange trends, which are expected to boost revenue and operating income for the second quarter of 2025 and the second half of the year. The analyst also highlighted emerging artificial intelligence tailwinds that could provide multi-year benefits. Piper Sandler also recently raised its price target on Netflix to $1,400, citing upbeat management commentary and higher revenue expectations for the third quarter of 2025. Needham also boosted its target to $1,500, highlighting the company's exceptional labor efficiency, while Wells Fargo upped the price target on the stock to $1,500 from $1,222. Pivotal Research Group lifted the price target to $1,600 from $1,350, citing Netflix's dominant position in the subscription streaming video market. What to Watch The company remains unscathed by the ongoing tariff chaos as the entertainment industry shows its resilience in tough economic times. Netflix's low-cost advertising-supported subscriptions and live sports expansion will continue to fuel growth. The streaming giant offered an upbeat outlook for the ongoing quarter on its last earnings call. It expects revenues to grow 15% year over year to $11.04 billion, while earnings per share are expected to rise 44% to $7.03. Valuations Netflix shares look expensive at current levels, with a P/E ratio of 49.65 versus 15.63 for the industry. However, it has a strong Growth Score of B, indicating that it is primed for more growth. This justifies its high valuation. Also, Netflix has become a popular defensive play in the current unsteady market. ETFs in Focus First Trust Dow Jones Internet Index Fund (FDN) First Trust Dow Jones Internet Index Fund follows the Dow Jones Internet Composite Index, giving investors exposure to the broad Internet industry. It holds about 40 stocks in its basket, with Netflix occupying the third spot at 10.1%. First Trust Dow Jones Internet Index Fund is the most popular and liquid ETF in the broad technology space, with AUM of $7.3 billion and an average daily volume of around 250,000 shares. FDN charges 49 bps in fees per year and has a Zacks ETF Rank #1 (Strong Buy) with a High risk outlook. FT Vest Dow Jones Internet & Target Income ETF (FDND) FT Vest Dow Jones Internet & Target Income ETF is an actively managed fund that invests primarily in U.S. exchange-traded equity securities intended to track the Dow Jones Internet Composite Index. It utilizes an "option strategy" consisting of writing (selling) U.S. exchange-traded call options on the Nasdaq-100 Index, or ETFs that track the Nasdaq-100 Index. It holds 41 stocks in its basket, with Netflix occupying the third position at 10.1% share. FT Vest Dow Jones Internet & Target Income ETF has accumulated $6.9 million in its asset base and trades in an average daily volume of about 3,000 shares. It charges 75 bps in annual fees. MicroSectors FANG+ ETN (FNGS) MicroSectors FANG+ ETN is linked to the performance of the NYSE FANG+ Index, which is an equal-dollar-weighted index. It is designed to provide exposure to a group of highly traded growth stocks of next-generation technology and tech-enabled companies. It holds 10 stocks in its basket in equal proportion, with Netflix's share coming in at 10%. MicroSectors FANG+ ETN has accumulated $479.3 million in its asset base and charges 58 bps in annual fees. It trades in a moderate volume of 109,000 shares a day on average and has a Zacks ETF Rank #3 (Hold) (read: Mag 7 ETFs Surge: Will the Rally Keep Rolling?). Communication Services Select Sector SPDR Fund (XLC) Communication Services Select Sector SPDR Fund offers exposure to companies from telecommunication services, media, entertainment and interactive media & services and has accumulated $23.5 billion in its asset base. It follows the Communication Services Select Sector Index and holds 23 stocks in its basket, with Netflix occupying the third position at 8.5% share. Communication Services Select Sector SPDR Fund charges 8 bps in annual fees and trades in an average daily volume of 6 million shares. It has a Zacks ETF Rank #2 (Buy). Invesco Next Gen Media and Gaming ETF (GGME) Invesco Next Gen Media and Gaming ETF offers exposure to companies with significant exposure to technologies or products that contribute to future media through direct revenues. It tracks the STOXX World AC NexGen Media Index, holding 93 stocks in its basket. Netflix is the fourth firm, accounting for 7.9% of the GGME assets. Invesco Next Gen Media and Gaming ETF has amassed $146.3 million in its asset base and charges 61 bps in annual fees. It trades in an average daily volume of 7,000 shares and has a Zacks ETF Rank #3. Want key ETF info delivered straight to your inbox? Zacks' free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week. Get it free >> Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Netflix, Inc. (NFLX): Free Stock Analysis Report Communication Services Select Sector SPDR ETF (XLC): ETF Research Reports MicroSectors FANG+ ETN (FNGS): ETF Research Reports Invesco Next Gen Media and Gaming ETF (GGME): ETF Research Reports
Globe and Mail
5 days ago
- Business
- Globe and Mail
First Trust Announces Shareholder Approval of New Investment Sub-Advisory Agreement and 'Manager of Managers' Structure for First Trust Smith Opportunistic Fixed Income ETF (FIXD) and First Trust Smith Unconstrained Bond ETF (UCON)
First Trust Advisors L.P. ('FTA') announced today that the shareholders of First Trust Smith Opportunistic Fixed Income ETF (formerly known as First Trust TCW Opportunistic Fixed Income ETF) (FIXD) and First Trust Smith Unconstrained Bond ETF (formerly known as First Trust TCW Unconstrained Plus Bond ETF) (UCON) (the 'Funds'), each a series of First Trust Exchange-Traded Fund VIII (the 'Trust'), have voted to approve for the applicable Fund (1) a new investment sub-advisory agreement (the 'New Sub-Advisory Agreement') among the Trust, on behalf of the Fund, FTA, as investment advisor, and Smith Capital Investors, LLC ('Smith Capital'), as investment sub-advisor, and (2) a 'manager of managers' structure (the 'Manager of Managers Structure'). New Sub-Advisory Agreement. At a meeting held on March 9-10, 2025 (the 'Board Meeting'), at the recommendation of FTA, the Board of Trustees of the Trust (the 'Board') unanimously approved, on behalf of each Fund: (1) the termination of TCW Investment Management Company LLC ('TCW'), the Fund's previous sub-advisor; (2) the appointment of Smith Capital as sub-advisor to the Fund pursuant to an interim sub-advisory agreement ('Interim Agreement') which became effective as of the close of business on May 9, 2025 following the termination of the Fund's prior sub-advisory agreement with TCW; and (3) the longer-term appointment of Smith Capital as sub-advisor to the Fund and, subject to shareholder approval, the implementation of the New Sub-Advisory Agreement. For each Fund, the New Sub-Advisory Agreement became effective upon shareholder approval and the Interim Agreement, pursuant to which Smith Capital was previously providing investment sub-advisory services, is no longer in effect. Manager of Managers Structure. At the Board Meeting, with respect to each Fund, the Board approved, and recommended that shareholders approve, the Manager of Managers Structure. As indicated above, the Manager of Managers Structure has been approved by shareholders of each Fund. In general terms, under each Fund's Manager of Managers Structure, FTA and the Trust, subject to approval by the Board, may enter into and materially amend investment sub-advisory agreements with affiliated and unaffiliated sub-advisors for the Fund without obtaining shareholder approval. In addition, under the Manager of Managers Structure, each Fund is permitted to disclose, as applicable, certain information regarding investment advisory and sub-advisory fees on an aggregate, rather than an individual, basis in various disclosure documents. As the investment sub-advisor to each Fund, Smith Capital is responsible for, among other things, the selection and ongoing monitoring of the securities in the Fund's investment portfolio. Smith Capital, with principal offices at 1430 Blake Street, Denver, Colorado 80202, was founded in 2018 and provides a disciplined, fundamentally driven approach to fixed-income investment management and advisory services. As of July 11, 2025, Smith Capital had approximately $12 billion under management or committed to management. FTA is a federally registered investment advisor and serves as each Fund's investment advisor. FTA and its affiliate, First Trust Portfolios L.P. ('FTP'), a FINRA registered broker-dealer, are privately-held companies that provide a variety of investment services. FTA has collective assets under management or supervision of approximately $268 billion as of May 30, 2025 through unit investment trusts, exchange-traded funds, closed-end funds, mutual funds and separate managed accounts. FTA is the supervisor of the First Trust unit investment trusts, while FTP is the sponsor. FTP is also a distributor of mutual fund shares and exchange-traded fund creation units. FTA and FTP are based in Wheaton, Illinois. The information presented is not intended to constitute an investment recommendation for, or advice to, any specific person. By providing this information, FTA is not undertaking to give advice in any fiduciary capacity within the meaning of ERISA, the Internal Revenue Code or any other regulatory framework. Financial professionals are responsible for evaluating investment risks independently and for exercising independent judgment in determining whether investments are appropriate for their clients.
Yahoo
09-07-2025
- Business
- Yahoo
Is First Trust Consumer Staples AlphaDEX ETF (FXG) a Strong ETF Right Now?
A smart beta exchange traded fund, the First Trust Consumer Staples AlphaDEX ETF (FXG) debuted on 05/08/2007, and offers broad exposure to the Consumer Staples ETFs category of the market. The ETF industry has traditionally been dominated by products based on market capitalization weighted indexes that are designed to represent the market or a particular segment of the market. A good option for investors who believe in market efficiency, market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns. If you're the kind of investor who would rather try and beat the market through good stock selection, then smart beta funds are your best choice; this fund class is known for tracking non-cap weighted strategies. This kind of index follows this same mindset, as it attempts to pick stocks that have better chances of risk-return performance; non-cap weighted strategies base selection on certain fundamental characteristics, or a mix of such characteristics. While this space offers a number of choices to investors, including simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies, not all these strategies have been able to deliver superior results. The fund is managed by First Trust Advisors. FXG has been able to amass assets over $296.81 million, making it one of the average sized ETFs in the Consumer Staples ETFs. Before fees and expenses, FXG seeks to match the performance of the StrataQuant Consumer Staples Index. The StrataQuant Consumer Staples Index is a modified equal-dollar weighted index designed by the AMEX to objectively identify and select stocks from the Russell 1000 Index that may generate positive alpha relative to traditional passive style indices through the use of the AlphaDEX screening methodology. When considering an ETF's total return, expense ratios are an important factor. And, cheaper funds can significantly outperform their more expensive cousins in the long term if all other factors remain equal. With one of the most expensive products in the space, this ETF has annual operating expenses of 0.62%. The fund has a 12-month trailing dividend yield of 2.24%. ETFs offer diversified exposure and thus minimize single stock risk, but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis. For FXG, it has heaviest allocation in the Consumer Staples sector --about 86.3% of the portfolio --while Healthcare and Materials round out the top three. Looking at individual holdings, Casey's General Stores, Inc. (CASY) accounts for about 4.9% of total assets, followed by Mckesson Corporation (MCK) and Cencora Inc. (COR). Its top 10 holdings account for approximately 41.2% of FXG's total assets under management. The ETF has added about 0.78% so far this year and is up about 1.57% in the last one year (as of 07/09/2025). In the past 52-week period, it has traded between $61.21 and $70.06 The ETF has a beta of 0.57 and standard deviation of 12.84% for the trailing three-year period, making it a medium risk choice in the space. With about 41 holdings, it has more concentrated exposure than peers . First Trust Consumer Staples AlphaDEX ETF is not a suitable option for investors seeking to outperform the Consumer Staples ETFs segment of the market. Instead, there are other ETFs in the space which investors should consider. Vanguard Consumer Staples ETF (VDC) tracks MSCI US Investable Market Consumer Staples 25/50 Index and the Consumer Staples Select Sector SPDR ETF (XLP) tracks Consumer Staples Select Sector Index. Vanguard Consumer Staples ETF has $7.63 billion in assets, Consumer Staples Select Sector SPDR ETF has $15.97 billion. VDC has an expense ratio of 0.09% and XLP changes 0.08%. Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Consumer Staples ETFs To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report First Trust Consumer Staples AlphaDEX ETF (FXG): ETF Research Reports This article originally published on Zacks Investment Research ( Zacks Investment Research Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
09-07-2025
- Business
- Yahoo
Is First Trust Large Cap Value AlphaDEX ETF (FTA) a Strong ETF Right Now?
A smart beta exchange traded fund, the First Trust Large Cap Value AlphaDEX ETF (FTA) debuted on 05/08/2007, and offers broad exposure to the Style Box - Large Cap Value category of the market. Products that are based on market cap weighted indexes, which are strategies designed to reflect a specific market segment or the market as a whole, have traditionally dominated the ETF industry. Market cap weighted indexes work great for investors who believe in market efficiency. They provide a low-cost, convenient and transparent way of replicating market returns. However, some investors believe in the possibility of beating the market through exceptional stock selection, and choose a different type of fund that tracks non-cap weighted strategies: smart beta. These indexes attempt to select stocks that have better chances of risk-return performance, based on certain fundamental characteristics or a combination of such characteristics. The smart beta space gives investors many different choices, from equal-weighting, one of the simplest strategies, to more complicated ones like fundamental and volatility/momentum based weighting. However, not all of these methodologies have been able to deliver remarkable returns. Because the fund has amassed over $1.13 billion, this makes it one of the average sized ETFs in the Style Box - Large Cap Value. FTA is managed by First Trust Advisors. This particular fund seeks to match the performance of the Nasdaq AlphaDEX Large Cap Value Index before fees and expenses. The NASDAQ AlphaDEX Large Cap Value Index is an enhanced index which employs the AlphaDEX stock selection methodology to select stocks from the NASDAQ US 500 Large Cap Value Index. Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive cousins if all other fundamentals are the same. Annual operating expenses for FTA are 0.58%, which makes it one of the more expensive products in the space. It has a 12-month trailing dividend yield of 2.01%. ETFs offer diversified exposure and thus minimize single stock risk, but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis. This ETF has heaviest allocation in the Financials sector - about 24.1% of the portfolio. Industrials and Information Technology round out the top three. Looking at individual holdings, Western Digital Corporation (WDC) accounts for about 1.23% of total assets, followed by Micron Technology, Inc. (MU) and On Semiconductor Corporation (ON). FTA's top 10 holdings account for about 10.76% of its total assets under management. The ETF return is roughly 5.89% and is up roughly 12.37% so far this year and in the past one year (as of 07/09/2025), respectively. FTA has traded between $67.12 and $83.49 during this last 52-week period. The ETF has a beta of 0.90 and standard deviation of 16.90% for the trailing three-year period, making it a medium risk choice in the space. With about 188 holdings, it effectively diversifies company-specific risk . First Trust Large Cap Value AlphaDEX ETF is a reasonable option for investors seeking to outperform the Style Box - Large Cap Value segment of the market. However, there are other ETFs in the space which investors could consider. Schwab U.S. Dividend Equity ETF (SCHD) tracks Dow Jones U.S. Dividend 100 Index and the Vanguard Value ETF (VTV) tracks CRSP U.S. Large Cap Value Index. Schwab U.S. Dividend Equity ETF has $71.32 billion in assets, Vanguard Value ETF has $139.67 billion. SCHD has an expense ratio of 0.06% and VTV changes 0.04%. Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Style Box - Large Cap Value To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report First Trust Large Cap Value AlphaDEX ETF (FTA): ETF Research Reports This article originally published on Zacks Investment Research ( Zacks Investment Research Error while retrieving data Sign in to access your portfolio Error while retrieving data Error while retrieving data Error while retrieving data Error while retrieving data
