Netflix Stock Jumps – We Profit!

Netflix, Inc. (NASDAQ:NFLX) Option Calls Provides 54% Potential Profit!

by Ian Harvey

April 18, 2018

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GETTING OUT WHILST THE GOING IS GOOD!

GREED CAN BE THE UNDOING OF A GOOD PROFIT!

Netflix, Inc. (NASDAQ:NFLX)

Here is an update of Netflix’s winning options call trade after reporting earnings. This options trade was recommended as a consideration in the article Earnings Predictions for the Week Beginning April 16, 2018”; which produced excellent potential profits of 54% -- and more to come -- within 24 hours of executing the trade!

YOU NEED TO BE IN TO PROFIT!

The Trade to Consider……

…….from ““Earnings Predictions for the Week Beginning April 16, 2018.”

The Details……..

Netflix, Inc. (NASDAQ:NFLX), a provider of Internet television network, will report earnings after the market closes. The consensus earnings estimate is $0.63 per share on revenue of $3.69 billion.  The Earnings Whisper number is $0.64 per share. Consensus estimates are for year-over-year earnings growth of 57.50% with revenue increasing by 39.95%.

Overall earnings estimates have been revised higher since the company's last earnings release. Three months ago, Netflix shares rose more than 13% in a single day after reporting analyst-stumping fourth-quarter results.

Netflix has been one of the strongest stocks in the market this year. Shares have risen sharply, and investors remain incredibly bullish at this time. Netflix has done a fantastic job growing its subscribers, adding a massive 8.3 million new subscribers just last quarter. Of the new subscribers, close to 2 million were domestic.

CEO Reed Hastings and his team have predicted that this positive momentum will continue into 2018, with subscriber growth forecast to accelerate to about 6.35 million this quarter from 4.95 million in the year-ago period. New content releases and growth in international markets will be the main drivers behind those gains.

Overall technical indicators for NFLX are bullish with a strong upward trend. The stock has recent support above $280.00, and recent resistance below $320.00.

Short interest has decreased by 10.4% since the company's last earnings release.

Of the 34  analysts who cover the stock, 18 rate it a “strong buy”, two rate it a “buy”, 13 rate it a “hold”, and one rates it a “strong sell”.

The Trade……..

** OPTION TRADE TO CONSIDER: Buy the COP MAY 18 2018 320.000 CALL at approximately $16.70.

The Result………

Netflix stock jumped yesterday after it crushed expectations for new subscriber growth in the first quarter and guided higher than views for the current quarter.

Shares surged another 9.2% to close at $336.06.

Netflix earned 64 cents a share, up 60% year over year, on sales of $3.70 billion, up 40%, in the March quarter. For the June quarter, the company expects to earn 79 cents a share, up 427%, on sales of $3.93 billion, up 41%.

The internet television network added 7.41 million new streaming subscribers in the first quarter, beating its target for 6.35 million. It ended the March quarter with 125 million subscribers worldwide, including 56.71 million in the U.S. and 68.29 million in international markets.

Future Outlook……

For the second quarter, Netflix expects to add 6.2 million subscribers worldwide, topping Wall Street's target of 5.2 million net new subscribers in the period.

The stock received at least 20 price-target increases from Wall Street firms late Monday and Tuesday. Of those, 11 rate it as buy, eight as neutral and one as underperform.

The Profit……..

So, for those traders who managed to execute this trade recommended by Stock Options Made Easy; a nice tidy potential profit of 54% was to be made within a few hours. Entering the option trade at $16.70; reaching as high as $25.69 (before closing at $23.60); one options contract would provide a profit of $899.00.

ACTION TO TAKE…….

"YOU NEED TO BE IN IT TO WIN IT!"

Now is the time to decide if it is worth continuing to hold this trade or exit on excellent profits. It is nearly always prudent to exit a trade before an unknown incident occurs that could rattle a sound profit, and this is a fine example of such a situation.

As you would have by now realized, many of our trades are based on earnings predictions. This is not to say all trades recommended to members follow this pattern, but during earnings season this strategy has been very profitable.

Our approach is to predict whether a company will beat or miss estimates, whether the stock will appreciate or depreciate as a result and what strategies investors and traders can use. This type of prediction is based on thorough investigation and fundamentally based research, and the results have been very exceptional.

Our proven track record says it all!!

Members of Stock Options Made Easy are provided with an extensive reason as to which direction a stock will move after earnings, followed up by a recommended options trade.

What To Do Now…….

If you interested in being part of this profitable action just click here……


Best of Trading,
Ian Harvey
Director of Stock Options Made Easy


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