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Netflix Stock Jumps
The more than 16% gain after hours in Netflix yesterday has been the big story from the US earnings landscape this week. The company’s stock soared after Netflix posted stronger-than-forecast results for Q3 yesterday. Looking at the headline numbers, EPS was seen at $3.73 vs $3.48 expected on revenues of $8.542 billion vs $8.538 billion expected.
New Accounts Soar
While many had been critical of Netflix’ recent decision to clampdown on account sharing by restricting password sharing, the move led to a surprise surge in subscriber growth over the period. The firm noted an 8.76 million increase in new subscribers, well above the 5.49 million increase Wall Street was looking for. The increase marks the biggest jump in new subscribers since Q2 2020 when COVID was in full swing. Additionally, Netflix noted that its ad-tier subscription base jumped by 70%.
Weaker Growth Forecast
Looking ahead, Netflix forecasts revenues growth of $8.69 billion in Q4, a touch below the $8.77 billion Wall Street was looking for. Still, on the back of these results, there are clearly bullish risks at play meaning that this is a stock to keep in mind for long opportunities moving forward.
Technical Views
Netflix
The correction lower in Netflix saw the stock finding strong support ahead of the 330.43 level. Price has since broken back above the bull channel lows and the 397.39 level. With momentum studies now bullish, focus is on a continued break higher with 475.17 the longer-run objective for bulls while 330.43 holds as support.
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With 10 years of experience as a private trader and professional market analyst under his belt, James has carved out an impressive industry reputation. Able to both dissect and explain the key fundamental developments in the market, he communicates their importance and relevance in a succinct and straight forward manner.