stock deserves to be shredded after its latest earnings report
It could be time to book profits on Netflix (NFLX), which has skyrocketed 34% this year.
And the reason for doing so is easily found 2018 Wholesale Newport And Marlborl Cigarettes USA on the streaming giant’s investor relations page under the financial reports section.
At first blush, Netflix delivered in the first quarter... and then some. Netflix reported first quarter earnings of 76 cents a share versus Wall Street analyst estimates of 57 cents a share. Net sales clocked in at $4.52 billion, slightly above forecasts for $4.5 billion.
Netflix added 9.6 million total new subscribers in the quarter, up 16% from a year ago. Analysts estimated 8.94 million new additions.
Nevertheless, Netflix shares dropped as much as 4% in after-hours trading today.Here are several of the red flags Yahoo Finance dug up on Netflix’s quarter:
Netflix sees a deceleration in new subscriber additions in the second quarter to 5 million. Wall Street had expected 6.09 million.
Sales growth slowed for the fourth straight quarter.
The year-over-year growth trend in paid memberships also continues to be lower.
At an outflow of $460 million in the quarter, Netflix burned cash at a faster rate than the year ago quarter ($287 million).
Some of Netflix’s commentary on its earnings press release is unlikely to help sentiment, either.
“We’re working our way through a series of price increases in the U.S., Brazil, Mexico and parts of Europe. The response in the U.S. so far is as we expected and is tracking similarly to what we saw in Canada following our Q4’18 increase, where our gross additions are unaffected, and we see some modest short-term churn effect as members consent to the price change,” Netflix said.