Netflix (NFLX) stock has inched higher ahead of the company’s fiscal Q3 results, which are scheduled for after the market closes on Oct. 20. Consensus is for the streaming giant to report $0.82 in earnings per share (EPS) for its third financial quarter, which would represent nearly 39% growth on a year-over-year basis.
Versus its year-to-date high, Netflix shares are down nearly 35% at the time of writing.
Options Sentiment Is Bullish for Netflix Stock
Fortunately for the bulls, the options market believes the earnings event will accelerate NFLX stock’s recent move to the upside.
According to Barchart, the put-to-call ratio on contracts expiring Oct. 23 sits at 0.43x at the time of writing. A reading below 1.00x is typically characterized as in favor of the bulls. Data also pegs the upper price on those contracts at $78.34, indicating potential for a 7.78% surge in Netflix on the back of its fiscal Q3 earnings.
Investors should also note that the streaming giant has a history of closing October with a more than 5% gain on average — a seasonal pattern that further improves its near-term appeal.
How NFLX Shares Compare to Rivals
Netflix announced plans to cut its global workforce by about 6% this week, shortly after co-CEO Ted Sarandos said the company wasn’t growing as fast as he wanted.
Still, LightShed Partners’ co-founder Rich Greenfield says NLFX offers the best price-to-value in the streaming sector.
“I think you and most investors would be shocked at how little other services are used,” he argued in a recent CNBC appearance.
According to Greenfield, the giant’s aggressive push into the creator economy is clearly working, and it will eventually begin to show up in its share price.
What’s the Consensus Rating on Netflix?
Wall Street analysts also seem to agree with Greenfield’s bullish stance on NFLX, as evidenced in their consensus “Moderate Buy” rating on the streaming behemoth.
According to Barchart, the mean price target on Netflix shares sits at $93.43 as of writing, signaling potential for a nearly 30% rally over the next 12 months.
On the date of publication, Wajeeh Khan did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.