Post-Earnings Analysis - Netflix

LONDON, October 30, 2014 /PRNewswire/ --

Investor-Edge.com has issued free post-earnings analysis on Netflix Inc. (NASDAQ: NFLX). On October 15, 2014, the company reported its financial results for Q3 FY14 (period ended September 30, 2014). Click on http://www.investor-edge.com/FreeReports to read our free earnings review on Netflix Inc. During Q3 FY14, Netflix Inc.'s U.S. contribution margin grew about 500 basis points on YoY basis to 28.6% and diluted EPS increased $0.44 from the preceding year quarter. Our free coverage report can be accessed at:

http://www.investor-edge.com/register

Earnings Overview 

During Q3 FY14, Netflix Inc. reported revenues of $1.409 billion, compared to $1.106 billion in the same period last year. The company's revenues during the reported quarter came marginally above Bloomberg analysts' forecast of $1.408 billion. The company added about a million new members in the U.S., ending the quarter with 37.22 million members. Domestic streaming revenue grew 25% to $877 million in Q3 FY14, from $701 million in the prior-year quarter, due to the expansion of ASP from the price changes implemented in Q2 FY14. Further, the company added two million members internationally, to end the quarter with 15.84 million members. International revenue surged 89% to $346 million in Q3 FY14, from $183 million in the corresponding quarter last year. The free research on NFLX can be downloaded as in PDF format at:

http://www.Investor-Edge.com/NFLXFreeReport

The company's operating income nearly doubled Y-o-Y to $110.40 million in Q3 FY14, from $57.12 million in the year-ago quarter, despite investment in international expansion. The company invested in personnel growth in its corporate General and Administrative (G&A) functions to support the aforesaid expansion, which is the primary driver of both its Y-o-Y and Q-o-Q increase in G&A. Additionally, contributing to the Q-o-Q increase was an increase in legal fees and one-time costs related to the launch of the company's new markets.

In its guidance for Q4 FY14, the company anticipates its U.S. contribution margin to increase by almost 500 basis points on a Y-o-Y basis, but Netflix Inc. also indicated a slight sequential decline in the U.S. contribution margin, due to significant sequential increases in content and marketing expenses. Starting in January 2015, the company has to pay higher VAT in most of Europe due to changes in European law, the absorption of which is likely to be reflected in slightly lower international contribution margin/profit starting in Q1 FY15. Sign up and read the free analyst's notes on NFLX at:

http://www.Investor-Edge.com/NFLX-30102014

Stock Performance 

On the following day of the earnings release, October 16, 2014, Netflix Inc.'s stock ended the session at $361.70, losing 19.37% for the day but the stock has managed to recover some of its losses since then. On the last close, Wednesday, October 29, 2014, it finished at $378.10, 2.10% below its previous day's closing price, after vacillating between $377.77 and $386.68. A total of 1.78 million shares were traded, which was below its three months average volume of 2.45 million shares. Over the previous three trading sessions and last one month, the company's shares have fallen by 1.80% and 15.90%, respectively. However, the stock has gained 2.70% from the beginning of 2014. Shares in Netflix Inc. closed below their 50-day and 200-day moving averages of $446.72 and $414.67, respectively. Furthermore, the stock traded at a PE ratio of 100.56 and has a Relative Strength Index (RSI) of 37.88. Visit Investor-Edge and access the latest research on NFLX at:

http://www.Investor-Edge.com/NFLXEarningsCoverage

Sneak Peek to Corporate Insider Trading 

In the last one month, there were four insider transactions made by Neil Hunt, Chief Product Officer at Netflix Inc. On October 01, 2014, he purchased a total of 5,000 shares of the company at an average price of $69.15 per share, and he disposed of an equal number of shares on the same day at an average price of $448.69 per share. Complimentary in-depth research on NFLX is available at:

http://www.Investor-Edge.com/NFLXInsiderTrading

About Investor-Edge.com 

At Investor-Edge, we provide our members with a simple and reliable way to leverage our economy of scale. Most investors do not have time to track all publicly traded companies, much less perform an in-depth review and analysis of the complexities contained in each situation. That's where Investor-Edge comes in. We provide a single unified platform for investors' to hear about what matters. Situation alerts, moving events, and upcoming opportunities.

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