Latest news with #NFLX
CNBC
8 hours ago
- Business
- CNBC
Netflix is experiencing a surprising pullback while S&P 500 hits records. How to trade it
Despite posting strong numbers — with revenue up 16% and full-year guidance raised — Netflix (NFLX) has taken a surprising hit, sliding 8% over the past 11 trading days. When a fundamentally solid stock like this pulls back hard, it tends to raise eyebrows. And for mean reversion traders, that's exactly the kind of set-up that gets us interested. The key question, though, is how do you know when the selling has run its course? Just because a stock drops doesn't make it an automatic buy — the trick is identifying the turning point with some degree of confidence. That's where technical indicators come into play. I outline this entire approach in my book "Mean Reversion Trading," and there are plenty of real-world trade breakdowns on For this particular setup on NFLX, I'm watching two specific indicators: Directional Movement Index (DMI) This indicator consists of three components: the DI+ (green line), the DI– (red line), and the ADX (blue line), which measures trend strength. Typically, a downtrend is in play when DI– is above DI+. But when the two lines begin to shift — with DI+ rising and DI– fading — it can signal that the tide is starting to turn. That's exactly what we're starting to see on the NFLX chart. DI+ is creeping higher while DI– begins to decline — a potential sign that the bearish pressure is fading and bullish momentum is gearing up. MACD (5,13,5) The MACD (Moving Average Convergence Divergence) is a classic tool for spotting trend reversals. While the standard settings (12,26,9) are widely used, they can be slow to react. To speed things up and get earlier signals, I've fine-tuned the inputs to (5,13,5). In this case, the MACD line (blue) hasn't crossed above the signal line (yellow) yet, but it's getting close. Past crossovers at similar price levels have consistently marked the end of short-term corrections — so if the signal fires this week, it could set the stage for a potential reversal trade. The Trade Setup: NFLX 1175-1180 Bull Call Spread For this mean reversion setup on NFLX, I'm using a bull call spread — a straightforward options strategy that caps risk while still offering solid upside. One of the reasons I like this setup is how efficient it is: you can get exposure for around $250 per spread, and scale in easily by adding contracts as the trade unfolds. To put some numbers behind it — running 10 spreads would mean risking $2,500, with the potential to earn $2,500 in profit if NFLX closes at or above $1180 by expiration. This trade is designed around a price range of $1175–$1185, with the idea being to structure the spread just around where the stock is trading. If NFLX pulls back further and dips below $1175, I'd consider adjusting the strikes down — for example, setting up a $1170–$1175 spread — to take advantage of a better entry with potentially higher reward. Here is my exact trade setup: Buy $1175 call, Aug 29th expiry Sell $1180 call, Aug 29th expiry Cost: $250 Potential Profit: $250 -Nishant Pant Founder: Author: "Mean Reversion Trading" Youtube, Twitter: @TheMeanTrader DISCLOSURES: (NFLX bull call spread expiring on Aug. 22) All opinions expressed by the CNBC Pro contributors are solely their opinions and do not reflect the opinions of CNBC, NBC UNIVERSAL, their parent company or affiliates, and may have been previously disseminated by them on television, radio, internet or another medium. THE ABOVE CONTENT IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY . THIS CONTENT IS PROVIDED FOR INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSITUTE FINANCIAL, INVESTMENT, TAX OR LEGAL ADVICE OR A RECOMMENDATION TO BUY ANY SECURITY OR OTHER FINANCIAL ASSET. THE CONTENT IS GENERAL IN NATURE AND DOES NOT REFLECT ANY INDIVIDUAL'S UNIQUE PERSONAL CIRCUMSTANCES. THE ABOVE CONTENT MIGHT NOT BE SUITABLE FOR YOUR PARTICULAR CIRCUMSTANCES. BEFORE MAKING ANY FINANCIAL DECISIONS, YOU SHOULD STRONGLY CONSIDER SEEKING ADVICE FROM YOUR OWN FINANCIAL OR INVESTMENT ADVISOR. Click here for the full disclaimer.
Yahoo
2 days ago
- Business
- Yahoo
The Smartest Growth Stock to Invest $5,000 in Right Now
Key Points Netflix delivered another excellent quarterly report. The company continues to boast a strong moat and vast runway for growth. Shares may seem expensive, but the premium is justified given Netflix's prospects. 10 stocks we like better than Netflix › Let's start with an important caveat. Since investors have different goals, preferences, risk tolerances, and available capital, it's challenging to choose a stock that everyone would universally consider a smart buy. That said, among the many growth-oriented companies on the market right now, one which I feel looks particularly attractive is Netflix (NASDAQ: NFLX). The streaming giant continues to deliver in a highly competitive entertainment industry, and the stock has excellent long-term prospects. Here's why investors would be wise to put $5,000 into Netflix today. Another quarter with excellent results For several quarters running, Netflix has been impressing Wall Street with its earnings results. The company's Q2 revenue increased 15.9% year over year to $11.1 billion, slightly ahead of its $11.0 billion guidance. Netflix's earnings per share (EPS) of $7.19 also beat its $7.03 projection, growing by 47% compared to the year-ago period. And there were plenty of other bright spots -- Netflix's free cash flow soared almost 87% year over year as well. One thing driving these strong results was member growth. Netflix recently increased its prices in the U.S. and several other markets. Yet, new subscribers are still coming in. That says a lot about the company's business. Netflix is the leader in streaming, and its brand name and massive library of content continuously attract new users while retaining existing ones. That strong brand name also gives the business a competitive edge and pricing power. For the third quarter, Netflix is guiding for year-over-year revenue and EPS growth of 17% and 27%, respectively. Management also increased its full-year revenue outlook to a range of $44.8 billion to $45.2 billion, in part due to stronger than expected member growth. Why the future is bright for Netflix Netflix's brand isn't its only competitive advantage. The company's massive ecosystem of viewers grants it access to data it can use to produce new content (or license existing movies and shows) that its viewers will love. This leads to greater engagement as films spread through word of mouth and social media platforms, ultimately resulting in even more subscribers -- an excellent example of the network effect. Since 2019, the streaming landscape has undergone a significant evolution with numerous new platforms emerging, including some created by leading companies in the media and technology sectors. Netflix has continued to thrive despite all that, after an adjustment period. The company has introduced a low-price, ad-supported tier, for example, and it continues to scale its advertising business. Even with fears of an economic downturn swirling, the company's ability to grow its subscriber count while it raises prices suggests its customers aren't very price sensitive. If a recession does hit, that might somewhat impact demand for the company's services, but this wouldn't be the first time Netflix has navigated a tough macroeconomic environment. As the company's co-CEO, Greg Peters, stated during the Q2 earnings call, Netflix has been "historically pretty resilient in tougher economic times." Expect the same moving forward. Streaming has already positioned itself as the future of entertainment. It is vastly superior to cable in that it offers the ability to watch shows or movies on demand on multiple screens at any time. That's why streaming has been gaining ground while cable is losing market share. But old habits die hard. Millions of consumers are still tied to cable, helping to keep the industry alive in the U.S. That market will continue to shrink over time, though, and that remains a massive long-term opportunity for Netflix. As for the stock, Netflix's forward price-to-earnings ratio is just under 45 as of this writing. That sits well above the average of 19.9 for the communication services sector. However, Netflix has earned the premium given its market leadership, outstanding track record, and attractive long-term prospects. Perhaps the stock may be somewhat volatile in the short term, but over the long term, this won't matter too much. Those intending to hold Netflix for the next five to 10 years should still consider buying the stock, even at current levels. Netflix is a top pick for a broad swath of investors, and with $5,000, you can get a bit more than four of the company's shares as of this writing. Should you buy stock in Netflix right now? Before you buy stock in Netflix, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Netflix wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $636,628!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,063,471!* Now, it's worth noting Stock Advisor's total average return is 1,041% — a market-crushing outperformance compared to 183% for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of July 21, 2025 Prosper Junior Bakiny has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Netflix. The Motley Fool has a disclosure policy. The Smartest Growth Stock to Invest $5,000 in Right Now was originally published by The Motley Fool Sign in to access your portfolio
Yahoo
2 days ago
- Business
- Yahoo
1 Remarkable Stat That Highlights Just How Amazing Netflix Stock Has Been in Recent Years
Key Points Netflix is on track for another strong year where it is likely to finish up more than 20%. The company recently reported earnings, which yet again showed strong growth. 10 stocks we like better than Netflix › Netflix (NASDAQ: NFLX) recently reported another strong quarter, a testament to the company's ability to continually innovate and find ways to grow. It has been successful in making its own movies and shows, offering ads, and cracking down on password sharing -- all moves that may not have been all that convincing when they were first announced. And yet, the company continues to do well. The company's dominance in the streaming business has propelled its stock to a valuation of over $500 billion. It has been a tremendous market-beating stock, and there's one stat that highlights just how truly special and impressive Netflix has been as a long-term investment in recent years. Netflix stock is on track for at least a 20% gain for the seventh time in the past nine years As of Tuesday's close, shares of Netflix were up around 32% year to date. Unless the stock encounters some considerable headwinds later this year, odds are it will produce a return in excess of 20% yet again in 2025. And if that happens, that will be the seventh time it has done so in just nine years. The lone exceptions were in 2021 and 2022, when concerns around inflation and interest rates were weighing on growth stocks. In 2021, Netflix rose in value but by just 11% as a late-year decline sent it into a tailspin, which continued into 2022, when it fell by more than 50% that year. Aside from those blemishes, since 2017, the stock has routinely generated 20% gains or more annually. That's particularly impressive when you consider that the S&P 500's long-run average annual return is right around 10%. While the broad index has amassed returns totaling 185% since 2017, Netflix has blown past it with gains totaling more than 850%. The company continues to impress with solid earnings numbers Earlier this month, Netflix reported its latest earnings numbers, which continued to look strong. It beat analyst expectations for the second quarter (which ended on June 30), as revenue of $11.08 billion came in higher than forecasts of $11.07 billion. And its earnings per share of $7.19 came in comfortably higher than what Wall Street was looking for -- $7.08. Overall, its sales grew by 16% year over year. The company, did, however, warn that its margins will decline a bit in the latter half of the year as sales and marketing costs increase as the company releases more content. But that's a trend that has become the norm for the business in previous years and shouldn't necessarily raise alarms for investors. Should you buy Netflix stock today? Netflix has been a tremendous growth stock to own for several years now. Even with a massive decline in 2022, it has generated fantastic returns for investors who have held on. The streaming stock is undoubtedly expensive today, as it trades at 50 times trailing earnings, a steep premium. There is some risk of a correction in the near term, but with the company offering consumers a wealth of content and being a top streaming business to invest in, it's still hard not to like Netflix as a long-term investment. It may be due for a slowdown at some point, and it won't always generate 20% returns, but if you're willing to hang on, you can still generate great returns from investing in the business over the long haul. As a leader in the streaming industry, Netflix can be a good stock to buy and forget about. Should you buy stock in Netflix right now? Before you buy stock in Netflix, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Netflix wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $636,628!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,063,471!* Now, it's worth noting Stock Advisor's total average return is 1,041% — a market-crushing outperformance compared to 183% for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of July 21, 2025 David Jagielski has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Netflix. The Motley Fool has a disclosure policy. 1 Remarkable Stat That Highlights Just How Amazing Netflix Stock Has Been in Recent Years was originally published by The Motley Fool 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
2 days ago
- Business
- Yahoo
Breaking down Netflix viewership in 1H25
-- Netflix viewership rose slightly in the first half of 2025, though underlying engagement trends show mixed signals, according to MoffettNathanson. In a note to clients this week, the firm told investors that 'overall engagement grew +1% in 1H25 to 95.2 billion hours,' but noted that 'on a per-subscriber level, we estimate this represents a high-single-digit decrease in engagement.' However, adjusting for the volatility introduced by password-sharing changes, engagement appears more stable. 'On an owner household basis, stripping out the volatility of password sharing, engagement has been steady over the past 2.5 years,' MoffettNathanson wrote, citing Netflix (NASDAQ:NFLX)'s own comments on its second-quarter earnings call. Series are said to have continued to outpace films in driving viewership. The firm said series viewing rose 4% year over year to 71.1 billion hours, while film viewership declined 7% to 24.1 billion. 'Original series in 1H25 drove the second-highest level of engagement of any half since Netflix started releasing this data in 2023,' analysts said. Critically, the reception of Netflix's top shows has improved. 'Netflix continues to balance the need of producing a vast amount of content... while also focusing on the quality,' the note stated. However, original films have lagged. 'The reception to Netflix's original films remains muted,' analysts added, though they expect improvements in the second half of 2025, helped by recovery from the 2023 Hollywood strikes and recent management changes. Looking ahead, MoffettNathanson expects engagement to rise. A stronger content slate, including Wednesday Season 2, Stranger Things Season 5, and NFL Christmas Day programming, 'should also drive even higher advertising and further monetization opportunities across its subscriber base.' Related articles Breaking down Netflix viewership in 1H25 Apollo economist warns: AI bubble now bigger than 1990s tech mania If Powell goes, does Fed trust go with him? 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
5 days ago
- Business
- Yahoo
Here's What Supports Netflix's (NFLX) Long-Term Growth
Sands Capital, an investment management company, released its 'Sands Capital Technology Innovators Fund' Q2 2025 investor letter. A copy of the letter can be downloaded here. Technology Innovators focus on pioneering businesses worldwide that serve as key drivers or beneficiaries of significant long-term changes driven by technology. The fund returned 26.0% (net) in the second quarter compared to a 21.9% return for the benchmark, MSCI ACWI Info Tech and Communication Services Index. Easing geopolitical concerns, renewed AI optimism, resilient macroeconomic data, strong corporate earnings, and technical tailwinds boosted the markets for a quick recovery in the quarter. You can check the fund's top 5 holdings to know more about its best picks for 2025. In its second quarter 2025 investor letter, Sands Capital Technology Innovators Fund highlighted stocks such as Netflix, Inc. (NASDAQ:NFLX). Incorporated in 1997, Netflix, Inc. (NASDAQ:NFLX) is an entertainment services provider. The one-month return of Netflix, Inc. (NASDAQ:NFLX) was -9.94%, and its shares gained 85.59% of their value over the last 52 weeks. On July 23, 2025, Netflix, Inc. (NASDAQ:NFLX) stock closed at $1,176.78 per share, with a market capitalization of $500.044 billion. Sands Capital Technology Innovators Fund stated the following regarding Netflix, Inc. (NASDAQ:NFLX) in its second quarter 2025 investor letter: "Netflix, Inc. (NASDAQ:NFLX) is the world's largest producer and distributor of video streaming content, measured by content spending and subscriber base. Shares rose following strong first quarter 2025 results, which reflected solid subscriber growth and retention, continued margin expansion, and increased capital returns, including a $3.5 billion share repurchase—the largest in the company's history. Advertising momentum continued, bolstered by reports of a $9 billion internal ad revenue target by 2030. In our view, these results underscore the compelling value of Netflix's robust content portfolio, competitive pricing, and growing ad-supported tier. Video entertainment has historically remained resilient during economic downturns, and we expect Netflix's scale and market leadership to support ongoing durability and long-term growth." A home theater with family members enjoying streaming content together. Netflix, Inc. (NASDAQ:NFLX) is in 14th position on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 150 hedge fund portfolios held Netflix, Inc. (NASDAQ:NFLX) at the end of the first quarter, compared to 144 in the fourth quarter. While we acknowledge the potential of Netflix, Inc. (NASDAQ:NFLX) as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock. In another article, we covered Netflix, Inc. (NASDAQ:NFLX) and shared the list of stocks Jim Cramer shared thoughts on. Netflix, Inc. (NASDAQ:NFLX) contributed to the relative performance of Aristotle Atlantic Focus Growth Strategy in the second quarter. In addition, please check out our hedge fund investor letters Q2 2025 page for more investor letters from hedge funds and other leading investors. READ NEXT: The Best and Worst Dow Stocks for the Next 12 Months and 10 Unstoppable Stocks That Could Double Your Money. Disclosure: None. This article is originally published at Insider Monkey. 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
