If there is one company which has managed to change the very face of entertainment, it’s Netflix Inc. (NFLX Stock Report). It has done it by making online streaming the preferred medium for millions around the world. As earnings season begins, the most anticipated second-quarter report this week is going to be from Netflix. The company will publish its earnings today.
Although the company has grown remarkably over the past few years, Netflix stock price has been largely bullish over the past few months. It has soared 40%, which mirrors the 20% rise of S&P 500. Hence, it can be said that Netflix stock price which had been thought to be a volatile even a year ago, has now become a safe bet. However, the Q2 2019 results could have a big effect either way.
Premium Online Streaming Market
A year ago, it seemed that Netflix dominance of the premium online streaming market was going to continue for the foreseeable future. But the landscape has changed somewhat over the past few months. Disney (DIS Stock Report) taking full ownership of Hulu is definitely a company that could prove to be a tough competitor. Meanwhile, Apple (AAPL Stock Report) has also announced the launch of its own service.
Although the hugely popular show Stranger Things returned with a bang, some popular shows like The Office are going to be taken off by 2021. Additionally, the company had raised its subscription prices in May. It remains to be seen what sort of effect it has on its earnings.
Netflix had projected revenues of $4.928 billion for the second quarter. The company had also projected margins to be at a record high of 12.5%. The growth in revenues if it manages to hit the target would be 26% from the previous quarter. Net income is projected to come in at $.55 a share. Analysts on Wall Street have predicted earnings per share of $.56. In this regard, it is also important to keep in mind that Netflix is generally cautious with its predictions. This could make way for a surprise in Netflix stock price in either direction depending on earnings results.