There has been recent insider selling of NFLX. Ann Mather, a director, recently exercised a stock option with all of her holdings in NFLX stock worth $453,000 on July 3rd. There was also recent sells by Reed Hastings, CEO, exercised two options worth about $20,000,000 on June 25th and another $20,000,000 on May 21st. (http://openinsider.com/screener?s=nflx)
A lot has happened at Netflix since its last report. Netflix has had plenty of hit shows and films, including the third season of Stranger Things earlier this month. Disney (NYSE:DIS) struck a deal to take control and eventually full ownership of Hulu. Disney’s Captain Marvel became the first new film by the media giant to not be available for streaming through Netflix. The Office and Friends found new homes and will be leaving Netflix in the next two years. Netflix also held its annual shareholder meeting. A previously announced price increase went into effect in May. (https://www.fool.com/investing/2019/07/14/netflix-has-a-lot-to-prove-this-week.aspx)
Wedbush Securities analyst Michael Pachter reiterated his Underperform rating for Netflix stock on Friday, citing recent content departures. “We believe that Netflix’s valuation is unwarranted,” he wrote. “Content migration and price hikes could cause a deceleration in subscriber growth.” The company declined to comment. The analyst said that over the next several years Netflix would lose Disney and Fox content that represents about 25% of its current viewing hours.“We estimate that content from Comcast, Fox, Disney and Warner Bros. presently accounts for 60-65% of Netflix viewing hours, and we expect most of it to eventually migrate away,” he wrote. (https://www.barrons.com/articles/netflix-stock-expensive-content-disney-comcast-fox-warner-bros-51562954868)
Last Earnings Report ups and downs: NFLX provided a light guidance of .55 when analysts were expect .99 EPS. NFLX CEO also mentioned the entry of new competitors, but saw this as a positive because NFLX will now have more money that it isn’t spending on these big titles. Reed Hastings said that he is looking forward to using that extra money to create more in house titles and doesn’t see the new competition to impact subscription levels and investors should not be worried. (https://www.cnbc.com/2019/04/16/netflix-earnings-q1-2019.html)
Recap: Due to the recent insider selling, increased competition from Disney and FOX, as well as price increases, it shows the stock could be bearish, however Netflix has released several hit Netflix originals, including Season 3 of Stranger Things which shows positive growth for the company, as well as providing a light guidance of .55 EPS which could mean bullish stock reaction. NFLX earnings report is on 7/17 After Market Close.