In the latest trading session, Netflix (NFLX) closed at $370.98, marking a +0.86% move from the previous day. This move outpaced the S&P 500's daily loss of 0.44%. Elsewhere, the Dow lost 0.53%, while the tech-heavy Nasdaq lost 0.26%.
Heading into today, shares of the internet video service had gained 8.77% over the past month, outpacing the Consumer Discretionary sector's gain of 2.16% and the S&P 500's gain of 3.59% in that time.
Investors will be hoping for strength from NFLX as it approaches its next earnings release, which is expected to be October 15, 2018. On that day, NFLX is projected to report earnings of $0.68 per share, which would represent year-over-year growth of 134.48%. Meanwhile, our latest consensus estimate is calling for revenue of $3.99 billion, up 33.65% from the prior-year quarter.
For the full year, our Zacks Consensus Estimates are projecting earnings of $2.67 per share and revenue of $15.87 billion, which would represent changes of +113.6% and +35.72%, respectively, from the prior year.
Investors should also note any recent changes to analyst estimates for NFLX. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 1.44% lower within the past month. NFLX currently has a Zacks Rank of #3 (Hold).
Digging into valuation, NFLX currently has a Forward P/E ratio of 137.87. This valuation marks a premium compared to its industry's average Forward P/E of 11.3.
We can also see that NFLX currently has a PEG ratio of 4.6. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. Broadcast Radio and Television stocks are, on average, holding a PEG ratio of 1.39 based on yesterday's closing prices.
The Broadcast Radio and Television industry is part of the Consumer Discretionary sector. This industry currently has a Zacks Industry Rank of 101, which puts it in the top 40% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
You can find more information on all of these metrics, and much more, on Zacks.com.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.