Netflix (NASDAQ:NFLX)
Netflix, Inc. (NFLX), an internet television network company yesterday reported their second quarter 2016 financial results. Netflix reported second quarter earnings of $0.09 per share which beat analyst expectations of $0.02 per share. Netflix reported second quarter revenues of $2.11 billion which was in line with analyst expectations. However, Netflix said that it reported 1.7 million subscribers during the quarter which fell short of their own expectations of $2.5 million.
Netflix, Inc. CEO’s Comments
“We think some members perceived the news as an impending new price increase rather than the completion of two years of grandfathering. Churn of members who were actually ungrandfathered is modest and conforms to our expectations,” the company said in a statement.
CEO Reed Hastings said that he’s confident that this churn is what hit the subscriber numbers.
“Well the obvious explanations other than this are competition, which we’re pretty confident that it is not a factor because we got this slight uptick in churn in multiple countries the same week and—of course that’s not a competitive signature—including Canada, where many of the other SVOD services don’t operate,” he said in a conference call with investors on Monday. CNBC
NFLX Technical Analysis
NFLX opened trading yesterday at $98.43 which was up from the previous days trading of $98.39. NFLX closed trading yesterday at $98.81 and crashed down after market to $85.45, equivalent to a 14% decrease from the closing price. Taking a look at the daily chart we can see the last time NFLX traded below these levels was on June 27th, when it traded at $85.33. Taking a closer look at the daily chart we can see that NFLX has been on an overall downward trend dating back to April 15th when it traded of $111.51. NFLX has a float of 421.05 million shares and traded 1.17 times the normal daily trading volume on Monday. For trading purposes, I would like to see NFLX open trading on Tuesday below $90.00 and if it does I would be looking to take a short position at the bell. My stop loss would be $0.50 from my entry position fearing anything more than that and the stock would start to fill in the gap up.
Company Profile
Netflix, Inc., an Internet television network, engages in the Internet delivery of television (TV) shows and movies on various Internet-connected screens. The Company operates in three segments: Domestic streaming, International streaming and Domestic DVD. It offer members with the ability to receive TV shows and movies streaming content, including original series, documentaries, and feature films through a host of Internet-connected screens, such as TVs, digital video players, TV set-top boxes, and mobile devices. The company also provides DVDs-by-mail membership services. It serves approximately 75 million members in 190 countries. Netflix, Inc. was founded in 1997 and is headquartered in Los Gatos, California.