Netflix Stocks Soar After Earnings Boost
Utterly exceeding analysts’ expectations, the media streaming giant Netflix experienced a massive growth of online subscriptions in the third quarter of 2018. Although analysts from Morgan Stanley, Goldman Sachs, and Raymond James cut their price targets on Netflix ahead of its earnings report, the company has expanded its services as streaming revenues have also increased by 36% when compared to last year’s third quarter report. The statistics indicate that Netflix will continue its status as one of the highest performing stocks in the Wall Street Stock Exchange, especially considering the 80% increase of stock value from last year.
Netflix maintains its strong performance by riding the trend wave of digital streaming television. As the company expands, Netflix might become a threat for any cable or satellite companies. Customers have now begun the shift from conventional TV providers into online based services. E-marketer projects more than 60% of the U.S. population will be using streaming applications such as YouTube, Netflix, and Hulu, by the end of the year.
Netflix has their own way to compete with any cable or satellite companies by offering customers thousands of programs on-demand for a monthly fee. Furthermore, Netflix invests billions in their original shows as they are having a better payback in terms of people watching and valuing their subscription. As a result, the number of people paying for traditional cable or satellite companies has declined and caused media companies to merge. In order to compete with Netflix, media companies such as Disney and AT&T Inc., the parent of Warner Bros and HBO, have creat