With Over 75 Million Global Subscribers, Netflix Is Becoming Top S&P 500 Performer

Posted: Jan 20 2016, 4:07am CST | by , in News | Latest TV News


Netflix streaming video
Photo credit: Getty Images

A large and growing subscriber base is the only main thing that counts with video streaming service Netflix, and considering its over 75 million global subscribers according to latest earnings call, it is no surprise that the company is going places and its stocks performing excellently in the market, USA TODAY reports.

Netflix’s stocks rose by over 130% last year to over $114 per share, and this brought to becoming the top-performing stock for the S&P 500.

But analysts think the company’s stocks might perform better this year, given that its stocks rose 9% on January 6 after the company revealed it is now present in 190 countries of the world. But after ITG Investment Research disclosed last week that Netflix might not acquire up to its expected US subscribers for this current quarter, the company’s stocks fell by 9%.

ITG looks forward to Netflix announcing 1.13 new US subscribers on the close of market on Tuesday where its earnings for the fourth quarter will be disclosed, marking a 13% reduction in Netflix’s own expectations of 1.3 million new subscribers within the US for the given period.

"We would note that there is likely a great deal of uncertainty around U.S. sub adds this quarter," said RBC Capital Markets analyst Mark Mahaney, but he still looks forward to the subscription video service reaching its target and hit target of $140 for its stocks which currently stands at $104.04.

Analysts are aware that reduced subscriptions and paying customers could fatally injure Netflix’s share price, underscoring the point that the larger the subscribers the better earnings for the company. During the third quarter of 2015, the company’s aimed to acquire 1.15 million new US customers but came short of this by 270,000; putting the blame of new credit and debit cards integrated with chips issued to customers. The following day, share prices dropped by 8%.

And when new subscribers exceeded the anticipated number by 770,000 for the second quarter of 2015, share prices instantly rose by 18%.

According to senior vice president of Estimize, a crowdsourced financial estimates site, many other companies put their focus on share and revenue earnings, but Netflix is putting all its strength into growing its subscribers base.

Netflix released yesterday the earnings numbers for Q4 2015. On January 1st, just a few hours after the quarter closed, Netflix crossed 75 million members. Netflix quarter‐end 74.76 million members put the company at over 17 million net additions for the year, showing how well the international expansion works. Netflix estimates to grow by over 6 million members in Q1 given the expansion of Netflix to virtually everywhere but China.

Netflix reported a net income of $43 million. This is down from $83 million. The revenue in Netflix Q4 was $1.82 billion compared to $1.48 billion in the same period last year.


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The Author

<a href="/latest_stories/all/all/52" rel="author">Charles I. Omedo</a>
Charles is covering the latest discoveries in science and health as well as new developments in technology. He is the Chief Editor or Intel-News.




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