Netflix's 'Unloved Stock' Faces a Crucial Test With Today's Earnings Report

Netflix's next chance to win over investors comes today. The streaming giant is due to release its third-quarter results after markets close, following a rough stretch for the company that led to big job cuts -- and which has seen the stock drop, falling some 20% this year alone. Netflix (NFLX) is expected to report revenue of $12.88 billion, up 12% year-over-year, along with earnings of 82 cents per share, up from 59 cents a year ago. The stock has been pressured by investor worries about the company's recent engagement and revenue trends. Last week, Netflix cut 6% of its staff, equivalent to just under 1,000 employees. The shares slumped to their lowest point in two years after Netflix's last report in July, which included a disappointing revenue forecast. Netflix shares, which have lost more than 40% of their value over the past year, were ticking higher in early trading today. Wall Street analysts are broadly bullish, with a mean price target above $90; the shares closed Monday near $70. A rise to that target would still leave the shares shy of record highs above $130, though. But Gabelli Funds Portfolio Manager John Belton in emailed comments Tuesday called Netflix an "unloved stock." "Investors are concerned about soft engagement trends, decelerating revenue growth, a slower margin expansion outlook, and most recently content executive leadership changes," he wrote.

Netflix's 'Unloved Stock' Faces a Crucial Test With Today's Earnings Report

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