WBD - Netflix Q1 Results: What Happened

2024-04-18 20:20:28 ET

Summary

• Netflix, Inc. reported strong Q1 earnings, but the stock price reacted negatively.
• Netflix stock price did not surpass the previous peak levels. This could attract the attention of the technical investors (and not in a positive way).
• Earnings may have used overly optimistic assumptions, which are allowed by GAAP.
• Future growth is unlikely to match the expectations strongly implied by the price-earnings ratio of the stock price.
• Revenue, cash flow, and free cash flow did not match earnings progress. That is a key warning sign to investors.

Netflix, Inc. ( NFLX ) reported probably the best earnings in the company's history for the first quarter. Yet, the stock price could hardly have reacted in a worse way. Exactly what caused this?...

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