NFLX - 10/16/2019 - Earnings Play
This is a lotto play on NFLX. Currently in NFLX 10/18 285P. The target profit area is $252.28 which is the 9/24 low.
Based on Zacks' prediction, there will be a Earnings ESP of -2.09%. This means a negative earnings surprise. Historically speaking, NFLX hasn't performed the best during Q2 ER albeit mixed results looking over a 5 year trajectory. In addition, NFLX has been on a downtrend since 7/10 and has recently hit the 50DMA this week.
This is currently the obvious play, which means that if there's too many retail trades on the short side, algos can easily spike the price higher as much as $337.57. Hence, this is again, a LOTTO play.
Based on Zacks' prediction, there will be a Earnings ESP of -2.09%. This means a negative earnings surprise. Historically speaking, NFLX hasn't performed the best during Q2 ER albeit mixed results looking over a 5 year trajectory. In addition, NFLX has been on a downtrend since 7/10 and has recently hit the 50DMA this week.
This is currently the obvious play, which means that if there's too many retail trades on the short side, algos can easily spike the price higher as much as $337.57. Hence, this is again, a LOTTO play.
Note
NFLX High OI:Calls - $300
Puts - $180
According to one of my colleagues in the trading chatroom, if NFLX misses, this could drop as much as $100 from today's close.
Note
NFLX almost up 10% in after hours trading.Netflix Inc. NFLX, +0.71% added more than twice as many subscribers in the third quarter than it did in a disappointing previous quarter, the company said in an earnings report Wednesday afternoon, sending shares higher. Netflix reported 6.77 million new paying subscribers to its streaming service in the quarter, with only 500,000 coming from the U.S., where membership actually declined in the previous quarter. Analysts on average expected Netflix to add 6.7 million new subscribers, according to FactSet, after the company projected 7 million paid net adds. Netflix reported earnings of $1.47 a share on sales of $5.25 billion, up from profit of 89 cents a share on revenue of $3.91 billion a year ago. On average, analysts expected Netflix to report earnings of $1.03 a share on sales of $5.25 billion, according to FactSet. Netflix shares rose more than 2% in immediate after-hours trading following the release of the results Wednesday afternoon. Netflix stock was slammed after its last quarterly earnings report in response to disappointing subscriber growth, and has declined 21.8% in the past three months as the S&P 500 index SPX, -0.20% has dropped 0.3%.
Note
Caveat for this is if something negative gets spoken out of the earnings call and analyst upgrade/downgrades coming in the next couple of days.Either way , I'm not holding my breath. This was a LOTTO trade and they decided not to go for the "obvious" direction. Hope you all made money regardless :)
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Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.