Netflix (NFLX) Stock: After Friday’s Gains, What Can We Expect?


Netflix, Inc. (NASDAQ: NFLX)

Netflix has been having a rough time in the market as of late. During the last quarterly earnings report, the company showed record growth in users. The only problem was that the vast majority of users that were added to the network were outside of the United States, showing declines in US user growth. However, I’ve maintained my bullish opinion on the stock, and I’m glad I did. Recently yet another reason to be a bull on NFLX has popped up. RBC Capital Markets published results from a survey that got investors excited. Today, we’ll talk about the survey, other reasons to be bullish on NFLX, and what we can expect to see from the stock moving forward.

RBC Capital Markets Shows That Netflix Is Indeed Popular In The US

As mentioned above, the primary concern with regard to NFLX has been US user growth. However, RBC Capital recently published a report that shows that the streaming video service is the favorite among consumers in the United States. In a survey of more than 1,000 U.S. consumers that watch online video content, RBC Capital found that 53% now use Netflix. This is a record number, up from 51% in November. Perhaps more importantly, the survey showed that NFLX is more popular than YouTube and Amazon Prime Video, which showed usage percentages of 46% and 27% respectively.

Consumers that responded to the survey said that overall they were extremely satisfied or very satisfied. They also mentioned that NFLX has greatly improved its content over the past year.  Also, more than 70% of users said they are not likely to cancel the service, even given the price increase that’s likely coming down the line this year.

The Primary Reason I Maintained My Bullish Opinion

When the last earnings report was released and investors got concerned, I was actually excited, and for a very good reason. Late last year, NFLX announced that it is no longer a service that’s only available in the United States and nearby neighbors. Instead, NFLX has branched out to become a worldwide company by adding more than 130 countries to its target market. The company also said that it is working to bring streaming services to China, the world’s second-largest economy. The way I look at this is simple – if NFLX grew to be one of the largest streaming video services in the world with a small, local target market, imagine how big the company will grow as a worldwide service! In my opinion, gains are going to be exponential!

What We Can Expect To See Moving Forward

Moving forward, I have an overwhelmingly bullish opinion of what we can expect to see from Netflix. The reality is that the company has been making several changes to become a dominant player in its sector over time. First and foremost, as mentioned above, I’m incredibly impressed with the fact that NFLX has decided to go public. However, that’s not the only reason to be bullish on the stock. When it comes to online video streaming, content is king, and NFLX has been working to expand the amount of content it offers – not only with streaming content providers, but also with unique series. While the price may be going up for the service, all in all, things are looking great. Therefore, I believe that NFLX is likely to climb from here!

What Do You Think?

Where do you think NFLX is headed and why? Let us know your opinion in the comments below!

[Image Courtesy of Flickr]


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