Analysis Of The Weekly Performance Of Netflix Inc. (NFLX)

Netflix Inc. (NASDAQ:NFLX) finished Tuesday with an addition of $31.46 to close at $634.81, an upside of 5.21 percent. An average of 6,291,580 shares of common stock have been traded in the last five days. There was a gain of $50.96 in the past week. The last 20 days have seen an average of 4,031,625 shares traded, while the 50-day average volume stands at 3,302,568.

NFLX stock has increased by 7.50% in the last month. The company shares reached their 1-month lowest point of $568.08 on 09/20/21. With the stock rallying to its 52-week high on 10/05/21, shares of the company touched a low of $463.41 and a high of $626.12 in 52 weeks. In spite of this, the price is up 1.39% from the 52-week high.


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Insider Transactions

29 days have passed since Netflix Inc. (NFLX) last reported insider trading activity. MATHER ANN, who is Director, most recently acquired $809 shares at $600.00 per share on Sep 07. In this transaction, the insider spent $485,400. Director, Hoag Jay C, disposed of 35,401 shares at a price of $600.35 on Sep 07. The insider now owns more than $21,253,031 worth of shares. Prior to that, COO and Chief Product Officer Peters Gregory K went on to Sale 6,941 shares at $600.00 each on Sep 07. An amount of $4,164,600 was transacted.

Valuation Metrics

Netflix Inc. (NFLX) has a trailing price-to-earnings (P/E) ratio of 67.15, which compares with the 19.30 for the broader industry and 30.30 for the sector. This means investors are optimistic about the stock’s future prospects. In the last five years, Netflix Inc.’s PE ratio has ranged between 352.52 and 52.92. The stock’s beta is 0.71. Other valuation ratios to consider include the trailing price-to-sales (P/S) ratio at 10.14, the price-to-book (PB) ratio at 20.29, and the price-to-cash flow ratio at 201.18.

The quick ratio of Netflix Inc. for the three months ended June 29 was 1.20, and the current ratio was 1.20, indicating that the company is able to meet its debt obligations. Further, the company has a long term debt to equity ratio of 1.08 and a total debt to equity ratio of 1.13 for the quarter ending June 29. On the profitability front, the trailing 12-month gross margin is 44.30% against a 5-year average of 34.9%. Netflix Inc.’s EBITDA margin for the year ending June 29 is 62.04%, while its operating margin for the same period stands at 22.00%. Its gross profit as reported stood at $9.72 billion compared to revenue of $25.0 billion.

For investors, determining the potential profitability of the investment also depends on the performance of the company’s management. In the past 12 months, Netflix Inc.’s return on assets was 11.00%, compared to 4.8% over the last five years. In the past year, the return on investment has been 14.80%, and the 5-year average is 11.0%. Meanwhile, the return on equity (ROE) for the past 12 months has been 36.50% and the 5-year average holds at 22.3%. For the broader industry, ROE averaged 4.77 over the past year.

Technical Picture

From a technical analysis perspective, let’s take a brief look at Netflix Inc. (NFLX) price momentum. RSI 9-day as of the close on 05 October was 73.82%, suggesting the stock is Overbought, with historical volatility in this time frame at 30.80%.

As of today, NFLX’s price is $612.14 +8.73% or $50.96 from its 5-day moving average. NFLX is currently trading +4.63% higher than its 20-day SMA and +30.44% higher than its 100-day SMA. However, the stock’s current price level is +22.91% above the SMA50 and +19.12% above the SMA200.

The stochastic %K and %D were 80.52% and 79.94%, respectively, and the average true range (ATR) was 20.24. With the 14-day stochastic at 92.28% and the average true range at 17.97, the RSI (14) stands at 71.13%. The stock has reached 14.56 on the 9-day MACD Oscillator while the 14-day reading was at 21.54.

Analyst Ratings

The Benchmark Company reiterated its a Sell rating on Netflix Inc. (NASDAQ: NFLX), but raised their price target to $448, indicating a potential price decrease of -29.43% for the stock.The consensus rating for Netflix Inc. (NFLX) among analysts is Overweight. According to current brokerage recommendations, 3 brokerage firms advise that investors sell NFLX, while 7 suggest investors hold. There are 1 analyst who rate the stock as underweight. The stock is rated overweight by 5 analysts, while 30 others rate it as a “buy”.

What is NFLX’s price target for the next 12 months?

Analysts predict a range of price targets between $342.00 and $971.00, with a median target of $643.00. Taking a look at these predictions, the average price target given by analysts for Netflix Inc. (NFLX) stock is $631.93.

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