Investors are always on the lookout for stocks that have the potential to outperform during earnings season, and Netflix, Inc. (NFLX) may just be one of those companies. With earnings on the horizon, the stage is set for a possibly positive report. Recent developments indicate that Netflix is experiencing favorable adjustments to their earnings estimates, a sign often linked to an earnings surprise. Analysts raising estimates just before earnings, armed with the latest information available, usually points towards underlying positive trends for NFLX in the upcoming report.
The Outlook for Netflix, Inc.
Current estimates place the Most Accurate Estimate for the upcoming quarter at $4.54 per share for NFLX, slightly higher than the broader Zacks Consensus Estimate of $4.50 per share. This uptick in estimates suggests a positive sentiment among analysts towards NFLX, giving the stock a Zacks Earnings ESP of +0.45% as it heads into earnings season.
Why Analyst Estimates Matter
An important factor to consider is the Zacks Earnings ESP, which has historically proven to be a significant indicator of positive surprises and market outperformance. Looking back over the past decade, stocks with a positive Earnings ESP, coupled with a Zacks Rank #3 (Hold) or better, have often resulted in positive surprises nearly 70% of the time. Furthermore, these stocks have delivered an average of over 28% in annual returns. Given NFLX’s current Zacks Rank of #3 and a positive ESP, investors may find it worthwhile to take a closer look at this stock before the earnings release.
No guarantees exist for the future, however, a strong historical performance can illustrate potential. In the past three presidential election years, Bitcoin exhibited notable returns: 2012 saw a +272.4% increase, while 2016 and 2020 witnessed +161.1% and +302.8% returns respectively. With Zacks predicting another significant surge, the potential for further growth in the cryptocurrency market remains enticing. Click below for a deep dive into the tumultuous yet resilient history of Bitcoin.
Want to stay updated with the latest recommendations from Zacks Investment Research? Access the report on the 7 Best Stocks for the Next 30 Days absolutely free.