Netflix’s 3rd Quarter Financial Results Preview
As the world eagerly awaits Netflix’s 3rd quarter financial results, set to be released on Thursday night, October 17th, after the closing bell, investors are bracing themselves for what could be a rollercoaster ride in the stock market. With Netflix’s history of surprising both analysts and shareholders, the upcoming earnings report is sure to be a pivotal moment for the streaming giant.
Technical Analysis:
Despite the anticipation surrounding Netflix’s performance, the stock has shown resilience in recent weeks. Trading above $700, near its high print of $700 on 11/19/21, Netflix has managed to maintain its position above this key level. However, the lackluster breakout above the November 2021 peak suggests that the stock may be facing some challenges in its upward trajectory.
Fundamental and Valuation Metrics:
When Netflix reports its results, analysts will be looking for $5.12 in EPS on $9.77 billion in revenue, with expected year-over-year growth of 37% and 14% respectively. The company’s operating income is also expected to see a significant increase of 37% year-over-year.
- In the June ’24 quarter, Netflix reported impressive growth in revenue, operating income, and EPS year-over-year.
- One of the standout improvements in Netflix’s fundamentals has been the growth in operating cash flow and free cash flow over the past few years.
- Analysts are estimating free cash flow to reach $1.7 billion for Q3 ’24, with a potential increase to $6.6 billion by the end of the quarter.
With a 2.2% free cash flow yield and trading at 37x expected ’24 EPS, Netflix’s valuation metrics are under scrutiny. The stock’s current trading multiples indicate some skepticism regarding its projected earnings growth.
EPS and Revenue Estimate Revisions:
Over the past 18 months, Netflix’s EPS estimates have seen a significant upward revision, with expected growth for 2024 now at 60%. Revenue estimates, on the other hand, have been more conservative due to market saturation concerns in the US.
The Next Big Thing:
Recent reports suggest that Netflix’s “upfront advertising” revenue has doubled, leading to increased optimism among analysts.
- Analysts are projecting significant growth in ad revenue for Netflix in the coming years.
- There is speculation about a potential subscription price increase before the end of ’24.
Conclusion:
As investors brace for Netflix’s earnings release, the stock’s valuation and potential growth opportunities are under close scrutiny. While there is nervousness surrounding the upcoming report, the company’s advertising initiatives and potential revenue streams offer a glimmer of hope for long-term investors.
As the stock market remains volatile, it’s essential for investors to assess their risk tolerance and adjust their positions accordingly. With Netflix’s dominance in the streaming industry, the company’s long-term prospects seem promising, despite short-term uncertainties.
It remains to be seen how Netflix will navigate the challenges ahead and whether it can maintain its position as a leader in the ever-evolving entertainment landscape.
**Unveiling Netflix’s Performance: A Deep Dive into the Numbers**
*As the world’s top investment manager, I have meticulously analyzed Netflix’s recent performance to provide you with valuable insights. Let’s delve into the numbers and explore what they mean for investors.*
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**Earnings Estimate Revisions: A Sign of Stability**
The EPS and revenue estimate revisions for Netflix offer a glimpse into the sell-side expectations. While not a definitive indicator, these revisions can provide some comfort to investors regarding the company’s performance.
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**A Look Back: Previous Quarters’ Performance**
To gain a comprehensive view of Netflix’s trajectory, it’s essential to examine past quarters. Here are some articles from previous quarters that provide an in-depth analysis of the company’s earnings previews and follow-ups:
– July ’24
– March ’24
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**Impressive Year-to-Date Growth**
Netflix has shown remarkable growth this year, with a YTD increase of 45% as of October 15th, 2024. This growth is nearly twice that of the S&P 500’s YTD return, highlighting the company’s strong performance in the market.
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**Disclaimer: Proceed with Caution**
Before making any investment decisions, it’s crucial to remember that the information provided here is not advice or a recommendation. Past performance does not guarantee future results, and all EPS and revenue estimates are sourced from LSEG. Investors should assess their risk tolerance and adjust their portfolios accordingly. Remember, investing always carries the risk of loss, even in the short term.
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*In conclusion, understanding Netflix’s performance and the factors influencing it can help investors make informed decisions. By staying informed and assessing the market dynamics, investors can navigate the financial landscape with confidence.*
**Analysis:**
In this revised content, we have highlighted key aspects of Netflix’s performance, such as earnings estimate revisions, historical performance, and year-to-date growth. By breaking down complex financial information into digestible sections and providing a disclaimer for cautious investing, we aim to empower readers to make informed decisions. This content not only informs investors about Netflix’s performance but also emphasizes the importance of risk management and staying informed in the ever-changing financial landscape.