Filed under: Earnings reports, Netflix, Inc. (NFLX), Blockbuster Inc ‘A’ (BBI), Technical Analysis, Stocks to Buy

Once restricted to theaters, first-run motion pictures are now showing at home. The leading provider of online access to the movie world is headquartered in Los Gatos, California.

Netflix (NASDAQ: NFLX) is the world’s largest internet movie rental service, providing more than 7 million subscribers access to more than 85,000 DVD titles via U.S. mail delivery. Netflix also has a growing library of more than 5,000 choices that can be watched instantly on customers’ PCs. Netflix does not have due dates/late fees, and it employs user ratings to predict individual preferences and make movie recommendations. The firm has regional distribution centers throughout the United States. Blockbuster (NYSE: BBI) is a major competitor.

Investors were pleased this week when Netflix reported Q3 EPS of 23 cents and revenues of $294 million. The Street had been looking for 15 cents and $286.8 million. A total subscriber base of 7.02 million topped the analyst estimate (6.8M). Churn of 4.2 percent was below the Street expectation (4.5%). Management also guided Q4 EPS to 9-16 cents (4 cent consensus) and Q4 revenues to $297-$302 million ($284.54M consensus). The share price popped on the news and then moved into a bullish “pennant” consolidation pattern. Stocks frequently exit pennants moving in the same direction they were traveling on entry. In this case, that would be to the upside.

Continue reading Netflix (NFLX): Good earnings pop stock into bullish pennant

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This entry was posted on Saturday, October 27th, 2007 at 3:26 am and is filed under Stocks Money News. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.