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Market Views

Netflix gains 17% after beating investors expectation

Netflix for the first time ever passed the 200 million subscriber mark and had an impressive reserve of  $8.2 billion in cash.

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Netflix supporting education by offering some free shows

Netflix’s share price bounced about 17% higher after it beat market expectation, powering the video streaming stock to close high after adding more customers than expected and revealed it no longer needs debt in building its entertainment empire.

The positive upbeat guidance on free cash prompted bullish remarks from Wall Street analysts, though some questioned how much of the subscriber growth was pulled forward.

Stock traders increased their buying pressure on Netflix stock because of the surprisingly strong growth, as well as news that Netflix balance sheets are solid enough for Netflix considering share buybacks. Shares jumped 17% percent to $586.34 in recent trading Wednesday.

Netflix for the first time ever passed the 200 million subscriber mark and had an impressive reserve of $8.2 billion in cash.

READ: Netflix, Amazon, Zoom, Shopify drop over 10%

 

COVID-19 pandemic has aided Netflix’s business, forcing people in spending more time indoors coupled with curbing other traditional entertainment options like movie theaters and concerts.

Netflix added 25.9 million customers in H1, 2020, and ended up adding 36.6 million customers in all – a record.

“Investors come out of the fourth quarter incrementally more bullish on the potential of a powerful developing shareholder return story for Netflix in the coming years,” Evercore ISI analyst, Lee Horowitz wrote in a note to Bloomberg News.

READ: McCaleb, co-founder of Ripple sells 28.6 million XRP

Analysts at J.P. Morgan Securities said the company is likely to begin share buybacks in the second half of the year.

Quick fact: Netflix is an American streaming company that allows subscribers to watch movies, documentaries, different popular TV shows, and many more through internet-connected hardwires.

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Stephen Innes, Chief Global Market Strategist at Axi in a note to Nairametrics also spoke on the impressive gains sighted in the $259 Billion valued company;

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“Earnings reports also underpinned equity sentiment. Netflix rose 16% after noting its subscriber numbers increased by a record 37 million in 2020. Serenely, it seems lockdowns and TV go hand in hand.

READ: Nigeria leads the world in Bitcoin searches on Google

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“A testament to the maximum policy overdrive, investors wasted little time getting their feet wet after Janet Yellen espoused by the Biden “go big” policy approach to repair the economic damage caused by the pandemic, which also highlights the importance of helping small businesses and the unemployed.”

What to expect: The Stock market is seeing through longer lockdowns on the premise that COVID vaccinations will lead us out of the pandemic quickly and had helped triggered significant buying pressure on stocks like Netflix taking advantage of reduced social mobility in play

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Olumide Adesina is a France-born Nigerian. He is a Certified Investment Trader, with more than 15 years of working expertise in Investment trading. Follow Olumide on Twitter @tokunboadesina. He is a Member of the Chartered Financial Analyst Society.

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Market Views

Bears take Nigerian stocks hostage, investors lose N82.4 billion

Investor sentiment as measured by the market breadth closed negative with 12 advancers and 47 decliners.

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Bears

Nigeria’s all-share index fell further at the close of trading today, down by -0.40% to 39,364.67 points. Investors losses today stood at N82.35 billion.

  • Year-to-date return and market capitalization settled at -2.26% and N20.5 trillion, respectively.
  • Investor sentiment as measured by the market breadth closed negative with 12 advancers and 47 decliners.
  • Across coverage sectors, the performance was bearish. The NSE insurance, banking, consumer goods, and oil & gas sectors dipped 4.04%, 1.54%, 1.47%, 64 basis points, and 0.65%, respectively.
  • The flip side saw only the industrials improved marginally by 0.19%.

Top gainers

  1. UPL up 9.91% to close at N1.22
  2. MORISON up 9.09% to close at N0.6
  3. CAP up 5.26% to close at N20
  4. WAPCO up 3.59% to close at N20.2
  5. LIVESTOCK up 3.17% to close at N2.28

Top losers

  1. FIDSON down 10.00% to close at N4.41
  2. NNFM down 9.97% to close at N6.32
  3. ENAMELWA down 9.95% to close at N19.9
  4. NEM down 9.95% to close at N1.72
  5. NCR down 9.91% to close at N3.09

Outlook

Nigerian stocks ended the fourth trading session on a weaker note amid soaring oil prices prevailing at the U.S trading session.

  • Today’s bearish trading session was inclined by sell pressure on consumer ticker, DANGSUGAR which lost -6.25%. JBERGER, ARDOVA, and UBA also declined by -7.88%, 9.85%, and -3.64%, respectively.
  • Nairametrics expects intending buyers to seek the advice of certified stockbrokers.

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Market Views

Nigerian stocks plunge, as WEMA, CHAMPION, MANSARD slump

The market breadth closed negative as LASACO led 17 Gainers as against 23 Losers topped by CHAMPION at the end of today’s session.

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Nigerian banking stocks remain most liquid stocks, as investors gain N25.1 billion, DANGOTE CEMENT, OKOMUOIL and GUINNESS drag Nigerian Stock market down,  SEPLAT, GUINNESS, Breaks Nigerian Bourse Support Levels, Investors Lose N49 Billion  

Nigerian stocks wrapped up the week on a bearish note after the benchmark index registered its third negative close in the last five sessions.

  • Sentiments notably picked up where they left off yesterday, as selloffs persisted in bellwether ticker – ZENITHBANK (-1.55%) as well as in Telco giant – MTN Nigeria (-3.28%).
  • The 74 basis points pullback recorded today kept the All Share Index return firmly rooted in the red and also lowering the Year date returns to -1.88%.
  • Save for the Oil and Gas (+0.25%) index lifted by sustained interest in OANDO (+2.99%), all other sectors closed in the negative territory.
  • The Insurance (-2.32%), Banking (-0.48%), Consumer Goods (-0.40%), and Industrial Goods (-0.19) indices declined following price dips in MANSARD (-5.36%), ZENITHBANK (-1.55%), INTBREW (-3.65%), and WAPCO (-2.94%) respectively.
  • The market breadth closed negative as LASACO led 17 Gainers as against 23 Losers topped by CHAMPION at the end of today’s session

Top gainers

  1. LASACO down 9.82% to close at N1.23
  2. MBENEFIT down 8.11% to close at N0.37
  3. COURTVILLE down 5.00% to close at N0.21
  4. OANDO down 2.99% to close at N3.45
  5. NAHCO down 2.70% to close at N2.28

Top losers

  1. WEMABANK down 10.00% to close at N0.63
  2. CHAMPION down 10.00% to close at N2.52
  3. SUNUASSUR down 9.59% to close at N0.66
  4. AFRIPRUD down 5.74% to close at N5.75
  5. MANSARD down 5.36% to close at N1.06

Outlook

Nigerian stocks ended the last trading session of the week on a bearish note amid profit-taking across the market spectrum.

  • Downtrend was driven by price depreciation medium capitalized stocks amongst which are; WEMA, CHAMPION, MANSARD.
  • That being said, Nairametrics envisages cautious buying on the account that certain market indicators reveal investors are taking some of their gains across the market spectrum.

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