Netflix Inc (NFLX)

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Netflix Stock Gaps Lower as Revenue Growth Weighs
By: Schaeffer's Investment Research | April 19, 2024

• Netflix is no longer going to report one of its most important metrics

• NFLX is heading for its worst week since September despite the first-quarter earnings beat

Netflix Inc (NASDAQ:NFLX) stock is 8.2% lower to trade at $560.74 today, following a mixed first-quarter report. While the streaming giant beat quarterly earnings and revenue expectations, it issued a weaker-than-expected full-year revenue growth forecast and will no longer report quarterly subscriber gains -- arguably investors' favorite metric to track. Instead, Netflix will focus on revenue, operating margin, and engagement to assess its quarterly performance.

Netflix stock is on track for its lowest close since Feb. 13. The shares are barreling toward their worst week since September, and have finished in the red in five of the last six sessions. Year-to-date, NFLX still sports a 17.4% year-to-date lead, and is testing its 100-day moving average today.

The brokerage bunch piled the bull notes on, despite the negative price action. Needham upgraded NFLX to "buy" from "hold," while Pivotal Research raised its price objective all the way to $800 -- a 42.7% premium to the security's current perch.

Options traders also have something to say. Already, 52,000 calls and 53,000 puts have crossed the tape, with total options volume running at 12 times the intraday average. Most popular is the April 550 put, while new positions are being bought to open, while the the 560-strike put from the same monthly series is also popular.

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