Netflix is in for a brutal morning: The stock is down 35% in pre-market trading from its $118.84 close yesterday as some influential Wall Street analysts tell investors it’s time to dump the stock following last night’s disappointing earnings report and forecast. Susquehanna Financial Group’s Vasily Karasyov downgraded Netflix to “negative” from “neutral.” He says that it “looks like the nuclear winter scenario is playing out” for the company as “subscriber base expansion in the U.S. appears to be minimal and losses from international launches are weighing on profitability.” The combination will “put to rest the bull case on (Netflix) as we know it.” Janney Capital Markets’ Tony Wible also downgraded the stock to “sell” — and slashed his price target in half to $51. Calling the company’s business model “unsustainable” he says: “Fundamentals are eroding, management credibility is shot, international growth is deteriorating, and margins are imploding. Furthermore, the company’s disclosures support our view that the DVD business accounts for a disproportionate amount of (Netflix’s) profits (82%),” which means investors should look at it as an old-fashioned rental company instead of a digital-age power. Even Netflix supporters are retrenching. Credit Suisse’s John Blackledge cut his target price for the stock to $100 from $240 but is sticking with his “outperform” forecast. “We do not believe the opportunity has changed for (Netflix), we believe the competitive positioning is strong and will look for further inflection points in sub growth and (international) profit progress as catalysts over the next 12 months.”
Is It “Nuclear Winter” For Netflix? Analysts Tell Investors To Bail After 3Q Setbacks
What's Hot on Deadline
'Gods Of Egypt': 'Selma' Director Ava DuVernay Responds To Alex Proyas & Lionsgate Apology For Lack Of Diversity - Update
Black Friday Box Office Explodes: Top 20 Pics +112% Over Thanksgiving; Katniss Eyes $74.4M 5-Day - Saturday AM Update
Universal Lands Hot Novel 'The Girl Before'; Ron Howard To Direct, Brian Grazer & Michael De Luca To Produce
Two-Time Oscar Winner Jane Fonda Back In The Hunt For 'Youth' Three Decades After Her Last Nomination
'Person Of Interest' Gets 'The Mentalist' Treatment With 13-Episode Order; Will Season 5 Be Its Last?
Latest Film News
- ‘The Assassin’, ‘Carol’, ‘Mad Max: Fury Road’ Top BFI Sight & Sound’s Best…
- Will DiCaprio, Depp Or Smith Nab Best Actor Oscar Or Does Redmayne Take It Again? — Awardsline
- ‘Gods Of Egypt’: ‘Selma’ Director Ava DuVernay Responds To Alex Proyas & Lionsgate Apology For Lack Of Diversity…
- ‘Steve Jobs’ Composer Daniel Pemberton: Video Of ‘Circle Of Machines’ Performance
- Deadline’s The Contenders: ‘Son Of Saul’ Director László Nemes & Star Géza Röhrig Discuss The Harrowing Cannes Winner’s Journey…
- What Is This ‘Project Delirium’ Jennifer Lawrence Wants To Direct?