Morgan Stanley Has Lowered Expectations for Netflix (NASDAQ:NFLX) Stock Price

Netflix (NASDAQ:NFLX) had its target price decreased by stock analysts at Morgan Stanley from $83.00 to $80.00 in a research note issued to investors on Thursday, MarketBeat.com reports. The brokerage presently has an “overweight” rating on the Internet television network’s stock. Morgan Stanley’s price objective would indicate a potential upside of 14.78% from the company’s current price.

Several other brokerages also recently commented on NFLX. CICC Research lowered their price objective on shares of Netflix from $110.00 to $90.00 and set an “outperform” rating for the company in a research report on Tuesday, July 21st. JPMorgan Chase & Co. reaffirmed a “buy” rating on shares of Netflix in a report on Thursday, August 20th. UBS Group decreased their price target on Netflix from $130.00 to $115.00 and set a “buy” rating on the stock in a research note on Friday, July 17th. Daiwa Securities Group lowered their price target on Netflix from $102.00 to $76.00 and set an “outperform” rating for the company in a report on Wednesday, July 22nd. Finally, KGI Securities downgraded Netflix from an “outperform” rating to a “neutral” rating and set a $75.00 price objective for the company. in a research report on Friday, July 17th. Four analysts have rated the stock with a Strong Buy rating, thirty-five have issued a Buy rating, fifteen have issued a Hold rating and one has given a Sell rating to the company’s stock. Based on data from MarketBeat.com, the stock presently has an average rating of “Moderate Buy” and a consensus target price of $94.70.

Netflix Trading Up 1.5%

Shares of Netflix stock opened at $69.70 on Thursday. The company has a market capitalization of $290.23 billion, a price-to-earnings ratio of 21.94, a PEG ratio of 0.97 and a beta of 1.62. The company has a quick ratio of 1.14, a current ratio of 1.14 and a debt-to-equity ratio of 0.39. Netflix has a 12-month low of $65.08 and a 12-month high of $124.86. The firm’s 50-day moving average price is $75.52 and its two-hundred day moving average price is $81.64.

Netflix (NASDAQ:NFLX) last issued its earnings results on Thursday, July 16th. The Internet television network reported $0.80 EPS for the quarter, beating the consensus estimate of $0.79 by $0.01. Netflix had a net margin of 28.22% and a return on equity of 40.02%. The company had revenue of $12.56 billion during the quarter, compared to analysts’ expectations of $12.58 billion. During the same period in the previous year, the company earned $0.72 EPS. The business’s revenue for the quarter was up 13.4% compared to the same quarter last year. On average, analysts forecast that Netflix will post 3.59 earnings per share for the current fiscal year.

Insider Activity

In other Netflix news, CEO Theodore A. Sarandos sold 27,312 shares of the company’s stock in a transaction dated Tuesday, August 4th. The stock was sold at an average price of $73.35, for a total value of $2,003,335.20. Following the completion of the transaction, the chief executive officer owned 178,954 shares of the company’s stock, valued at $13,126,275.90. This represents a 13.24% decrease in their position. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is available at this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, CEO Gregory K. Peters sold 27,312 shares of Netflix stock in a transaction dated Thursday, August 6th. The shares were sold at an average price of $73.54, for a total value of $2,008,524.48. Following the sale, the chief executive officer directly owned 120,931 shares in the company, valued at $8,893,265.74. The trade was a 18.42% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. In the last quarter, insiders have sold 179,045 shares of company stock valued at $13,132,194. 1.24% of the stock is currently owned by insiders.

Institutional Inflows and Outflows

A number of large investors have recently added to or reduced their stakes in the business. Puff Wealth Management LLC acquired a new stake in Netflix during the 3rd quarter worth approximately $201,000. Elevation Wealth Partners LLC increased its position in Netflix by 122.0% in the 3rd quarter. Elevation Wealth Partners LLC now owns 1,001 shares of the Internet television network’s stock valued at $70,000 after acquiring an additional 550 shares during the period. Elm3 Financial Group LLC bought a new position in shares of Netflix during the third quarter valued at $416,000. Canandaigua National Trust Co of Florida acquired a new position in shares of Netflix during the third quarter worth $640,000. Finally, Canandaigua National Bank & Trust Co. bought a new stake in shares of Netflix in the third quarter worth $1,294,000. Institutional investors own 80.93% of the company’s stock.

More Netflix News

Here are the key news stories impacting Netflix this week:

• Positive Sentiment: Netflix receives a $2.8 billion breakup fee. Paramount paid Netflix to abandon its proposed $82.7 billion Warner Bros. deal, providing a substantial cash benefit while allowing Netflix to avoid taking on a large acquisition and integration burden. Paramount paid Netflix $2.8 billion to walk away from its Warner Bros. deal
• Positive Sentiment: The new Paramount-Skydance/Warner Bros. rival carries substantial debt. The merged company reportedly has about $80 billion of debt and significant interest obligations, potentially limiting its ability to spend aggressively on content or compete with Netflix on price and streaming investment. Skydance becomes a media giant with an $80 billion debt load
• Positive Sentiment: Disney is licensing content to Netflix. Deals involving titles such as “Percy Jackson” and “Ice Age” reinforce Netflix’s distribution scale and suggest traditional media companies may increasingly rely on its platform as linear television declines. Disney is opening the door to Netflix
• Neutral Sentiment: A proposed U.S. production tax credit could reduce content costs. Senator Tim Scott’s bill would provide a potentially transferable 20%–30% credit for qualifying domestic film and television production, but it has not been enacted and would apply to productions beginning after 2026.
• Neutral Sentiment: Co-CEO Ted Sarandos discussed repeatedly rereading Joseph Conrad’s Typhoon rather than management books. The comments provide cultural insight but have little direct effect on Netflix’s earnings outlook. Netflix co-CEO discusses his favorite book
• Negative Sentiment: Investors remain concerned about maturing growth. Recent revenue growth was 13.4%, with management expecting further deceleration, while rising content expenses and live-sports rights could pressure margins. Analysts also cite Netflix’s valuation and intense streaming competition as risks. Rising live sports costs and Netflix margins

About Netflix

Netflix, Inc (NASDAQ:NFLX) is a global entertainment company that operates a subscription-based streaming service. It offers a broad range of television series, films, documentaries, and other programming, including original productions developed under the Netflix brand and licensed content from third-party studios.

The company also provides advertising-supported viewing options in some markets and has expanded into related entertainment categories, including mobile and cloud-based games, live programming, and consumer products associated with selected titles.