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Netflix (NFLX) Outpaces Stock Market Gains: What You Should Know

Netflix (NFLX) closed the most recent trading day at $547.95, moving +1.34% from the previous trading session. This change outpaced the S&P 500's 0.12% gain on the day.

Prior to today's trading, shares of the internet video service had gained 9.92% over the past month. This has outpaced the Consumer Discretionary sector's loss of 1.48% and the S&P 500's gain of 3% in that time.

NFLX will be looking to display strength as it nears its next earnings release, which is expected to be July 20, 2021. The company is expected to report EPS of $3.16, up 98.74% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $7.31 billion, up 18.91% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $10.49 per share and revenue of $29.71 billion, which would represent changes of +72.53% and +18.87%, respectively, from the prior year.

Any recent changes to analyst estimates for NFLX should also be noted by investors. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 0.54% higher. NFLX is currently a Zacks Rank #3 (Hold).

In terms of valuation, NFLX is currently trading at a Forward P/E ratio of 51.56. This represents a premium compared to its industry's average Forward P/E of 14.08.

It is also worth noting that NFLX currently has a PEG ratio of 1.68. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. Broadcast Radio and Television stocks are, on average, holding a PEG ratio of 1.43 based on yesterday's closing prices.

The Broadcast Radio and Television industry is part of the Consumer Discretionary sector. This group has a Zacks Industry Rank of 116, putting it in the top 46% of all 250+ industries.

The Zacks Industry Rank includes is listed in order 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.

You can find more information on all of these metrics, and much more, on Zacks.com.


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Netflix, Inc. (NFLX): Free Stock Analysis Report
 
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