Why are Institutional Investors Interested in Buying Netflix Inc. (NFLX)?

Netflix Inc. (NASDAQ: NFLX) is 72.00% higher on its value in year-to-date trading and has touched a low of $252.28 and a high of $575.37 in the current 52-week trading range. The NFLX stock was last observed hovering at around $529.56 in the last trading session, with the day’s gains setting it 26.99% off its average median price target of $550.00 for the next 12 months. It is also 10.95% off the consensus price target high of $625.00 offered by 41 analysts, but current levels are -152.98% lower than the price target low of $220.00 for the same period.

Currently trading at $556.55, the stock is 11.75% and 12.89% above its SMA20 and SMA50 respectively. However, with a daily trading volume of 9.54 million and changing 5.10% at the moment leaves the stock 38.83% off its SMA200. NFLX registered 92.38% gain for a year compared to 6-month gain of 45.01%. The firm has a 50-day simple moving average (SMA 50) of $498.26 and a 200-day simple moving average (SMA200) of $432.91.

The stock witnessed a 11.62% loss in the last 1 month and extending the period to 3 months gives it a 31.89%, and is 13.45% up over the last 5 days. If we measure the stock’s price variations over the week and the month, we find that the volatility rates stand at 5.22% over the week and 3.16% over the month.

Netflix Inc. (NFLX) has around 8600 employees, a market worth around $246.56B and $22.63B in sales. Current P/E ratio is 98.59 and Fwd P/E is 63.25. Profit margin for the company is 11.90%. Distance from 52-week low is 120.61% and -3.27% from its 52-week high. The company has generated returns on investments over the last 12 months (10.20%).

Netflix Inc. (NFLX) Analyst Forecasts

Analyst recommendations provided by FactSet shows that the consensus forecast for Netflix Inc. (NFLX) is a “Overweight”. 41 analysts offering their recommendations for the stock have an average rating of 2.30, where 11 rate it as a Hold and 4 think it is a “Overweight”. 21 of the analysts rate the stock as a “Buy”. 4 analysts have rated the stock as a Sell or Underperform.

Netflix Inc. is expected to release its quarterly report on 10/14/2020 and quarterly earnings per share for the current quarter are estimated at $2.12 with sales reaching $6.36B over the same period.The EPS is expected to grow by 46.90% this year, but quarterly earnings will post 23.40% year-over-year. Quarterly sales are estimated to grow 21.30% in year-over-year returns.

Netflix Inc. (NFLX) Top Institutional Holders

1,975 institutions hold shares in Netflix Inc. (NFLX), with 7.15M shares held by insiders accounting for 1.62% while institutional investors hold 84.86% of the company’s shares. The shares outstanding are 440.57M, and float is at 433.76M with Short Float at 2.22%. Institutions hold 83.49% of the Float.

The top institutional shareholder in the company is Capital Research Global Investors with over 34.11 million shares valued at $15.52 billion. The investor’s holdings represent 7.73% of the NFLX Shares outstanding. As of Jun 29, 2020, the second largest holder is Vanguard Group, Inc. (The) with 34.0 million shares valued at $15.47 billion to account for 7.71% of the shares outstanding. The other top investors are Blackrock Inc. which holds 29.17 million shares representing 6.61% and valued at over $13.27 billion, while FMR, LLC holds 5.00% of the shares totaling 22.03 million with a market value of $10.03 billion.

Netflix Inc. (NFLX) Insider Activity

A total of 239 insider transactions have happened at Netflix Inc. (NFLX) in the last six months, with sales accounting for 166 and purchases happening 73 times. The most recent transaction is an insider sale by KILGORE LESLIE J, the company’s Director. SEC filings show that KILGORE LESLIE J sold 905 shares of the company’s common stock on Aug 26 at a price of $537.96 per share for a total of $0.49 million. Following the sale, the insider now owns 35196.0 shares.

Netflix Inc. disclosed in a document filed with the SEC on Aug 24 that BARTON RICHARD N (Director) sold a total of 5,584 shares of the company’s common stock. The trade occurred on Aug 24 and was made at $500.00 per share for $2.79 million. Following the transaction, the insider now directly holds 7236.0 shares of the NFLX stock.

Still, SEC filings show that on Aug 20, HASTINGS REED (Co-CEO) disposed off 37,716 shares at an average price of $494.65 for $18.66 million. The insider now directly holds 0 shares of Netflix Inc. (NFLX).

Netflix Inc. (NFLX): Who are the competitors?

The company’s main competitors (and peers) include The Walt Disney Company (DIS) that is trading -2.02% down over the past 12 months. BCE Inc. (BCE) is -9.74% down on the 1-year trading charts. Short interest in the company’s stock has fallen -7.79% from the last report on Jul 14, 2020 to stand at a total of 10.38 million short shares sold with a short interest ratio of 1.16.