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Find new investment opportunities based on Market Sentiment Indicator. Manage watchlist risk with leading indicator of volatility See what influential analysts and investors are saying about stocks in your watchlist
Most Trending
Most Trending
Netflix's stock falls after cutting prices in 30 developing countries; Wells Fargo warns of further reductions in 100+ countries. Yemen, Jordan, Iran, Kenya, Croatia, Venezuela, and Indonesia are among the affected nations, impacting 10M+ subscribers (4% of total). Notably, prices remain unchanged in developed nations, where subscription fees are already higher.
In an effort to compete with rivals, Netflix aims to boost its subscriber count; however, doing so amidst inflation signals a lack of strength. As investors take note of this vulnerability, the stock is experiencing a decline.
Netflix's stock is experiencing its worst day in two months, though it's important to note that the company faced a 75% crash in stock value last year. In the past year, Netflix has struggled against tough competition from Disney Plus, Amazon Prime, Paramount+, and others, compounded by the weakening impact of the COVID-19 pandemic as restrictions ease. Additionally, as inflation and interest rates rise globally, individuals are seeking ways to reduce expenses, and video streaming services are a logical area to cut costs.
Perhaps Netflix is seeking to expand its reach in developing nations, having potentially exhausted growth potential in the US and Canada. However, investors are concerned. In recent weeks, the company has outlined plans to curb password sharing among subscribers. Under the new system, users must connect to the subscription through the main network's WIFI at least once a month, to confirm they reside in the same household. This approach presents potential issues for families who live apart, but could assist in reducing multiple users on a single account.
Netflix's stock jumped after the publication of the latest reports, in which it reported an addition of 7.7 million subscribers, and this after it lost customers in the previous quarters, when its competitors actually managed to add subscribers, but the average income per subscriber - is on the decline.
"We are always looking at ways to improve our members' experience. We can confirm that we are updating the pricing of our plans in certain countries," a company spokesperson said today.
In Netflix's latest reports, it missed out on the profit line (but jumped due to the addition of subscribers, as mentioned). The company recorded an adjusted profit of 12 cents per share, significantly lower than analysts' expectations of 42 cents per share. In the line of revenues, the company scored with 7.85 billion dollars; The forecast for the next quarter is not impressive - the company expects a profit of $2.82 per share, below the expected $2.99 per share. The operating margin will drop to 19.9%; At the same time, Netflix announced that the company's CEO, Reed Hastings, is stepping down and will become the company's chairman. The one who stepped into his shoes is Chief Operating Officer (COO) Greg Peters, who joins Ted Sarandos and both will be joint CEOs of the company
In the previous quarter, Netflix decided to stop publishing forward forecasts regarding the changes it expects in the number of subscribers and provides only the data on the actual results. The analysts expect an addition of 2.6 million net new subscribers in the current quarter. Apparently, even without any information from Netflix regarding the actual subscriber growth rate, analysts will continue to include the figure in their models.
Netflix is currently trading at a price of $323 per share and according to a market value of only $144 billion. Since last June, the company's stock has completed an 85% jump in value, but this is after a 75% crash in the stock earlier (from a price of $690 per share). That is, to return to its peak value, Netflix still needs to double its value - from the current point.
In February, 41 analysts provided coverage of the stock, with 25 recommending a "buy" and 14 recommending a "hold." The average target price for the stock is $354 per share, indicating a potential upside of 9%.
Please note that the article should not be considered as investment advice or marketing, and it does not take into account the personal data and requirements of any individual. It is not a substitute for the reader's own judgment, and it should not be considered as advice or recommendation for buying or selling any securities or financial products.
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Disclaimer:
The Score performance whether actual or indicated by historical tests of strategies, is no guarantee of future performance or success. The results reflect performance of a strategy not historically offered to investors and does not represent returns that any investor actually attained.
The results reflect performance of a strategy not historically offered to investors and does not represent returns that any investor actually attained. The Readiness Indicators, Sentiment Indicators and total score are calculated by the retroactive application of a model constructed on the basis of historical data and based on assumptions integral to the model which may or may not be testable and are subject to losses. Active trading is generally not appropriate for someone of limited resources, limited invesment or trading experience, or low-risk tolerance. Your capital may be at risk.
Please note that no offer or solicitation to buy or sell securities, securities derivatives of future products of any kind, or any type of trading or invesment advise, recommendation or strategy, is made, given or endorsed by StocksRunner including any of their affiliates ("TS").
This information is provided for illustrative purposes only. You should not rely on any advice and/or information contained in this website and before making any investment decision. we recommend that you consider whether it is appropriate for your situation and seek appropriate financial, taxation and legal advice.
