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NFLX

Are Markets Overvaluing These 3 Stocks? LULU, NFLX, SQTwo recent stock events have called into question how markets are pricing stocks. The first event is the OG meme stock, Tesla (NASDAQ: TSLA), hitting a one trillion-dollar market cap. And the second event is EV newcomer Rivian Automotive (NASDAQ: RIVN), surpassing the valuation of Ford Motor Company (NYSE: F) after listing on the NASDAQ. One way to gauge how overvalued a stock may be is to find its multiple (aka, Price-To-Earnings ratio). In the case of Tesla, it’s multiple, as of writing, is ~350. In the case of Rivian, it doesn’t have any sales to speak of, so a multiple for this Company is not discernible (as reported by Bloomberg; “Rivian is now the biggest US company with no sales”). Investors can be concerned about high multiples if the Company in question is unlikely to grow its profitability to a level that better reflects the stock’s current price. Tesla and Rivian are just two companies that analysts (incl. Tesla’s CEO Elon Musk) commonly point out as overvalued. Keep reading to learn what other 3 stocks market analysts commonly categorise as overvalued. Are Markets Overvaluing These 3 Stocks? LULU, NFLX, SQ Lululemon Athletica (NASDAQ: LULU) Several outlets, including Forbes, noted the athleisure wear company to be overvalued in the first half of 2021. Yet, difficult to discourage, investors have continued to support the Company and further bumped up the stock’s price. LULU is currently trading at an 15% premium above its first-half peak price (US $404 vs US $465). Its current valuation places its multiple at ~74x earnings. The momentum behind the stock is driven by its consistent earnings report beats and ambitious sales targets set by management, which are being hit or surpassed with surprising frequency. The Company’s outlook is buoyed by a growing (and incredibly loyal) customer base and higher margins. In this way, Lululemon stock may well be within a fair valuation if it continues to ride the growth momentum in which it is currently swept up. Netflix (NASDAQ: NFLX) Numerous Analysts were calling Netflix overvalued in 2020, even as the streaming giant reported subscriber growth beats during quarantine lockdowns and beyond. Bearish comments would call attention to the cash-burn needed by Netflix for the foreseeable future to maintain its industry leadership and satisfy its growing user base. Bullish sentiment could counter this argument by pointing to the Company improving operating margins (e.g., Netflix has improved its operating margin from 16% to 23.5% YTD). However, Netflix does not include content generation spending as an operating cost. Instead, it is considered a fixed cost for the business. Yet, suppose Netflix is going to be burning cash producing content for the foreseeable future. In that case, the improving operating margin might be considered no more an accounting trick than a meaningful metric. As of writing, Netflix shares are trading at US ~$690, indicating a multiple of approximately ~62 earnings. Square (NYSE: SQ) The digital payment provider Square appears to be firmly in the camp of overvalued tech stock. At least, according to Morningstar analysts, SQ is trading at more than double its “fair value estimate” (US ~$230 vs. $112) with a Price-To-Earnings value of ~240. SQ shares have not traded at US $112.00 or below since July 13, 2020. While SQ does deliver on growth, it still has a very long way to go to justify its ~240x multiple. Square’s dubious long-term outlook is compounded by the increasingly tense competition from PayPal (NASDAQ: PYPL) and Fiserv’s (NASDAQ: FISV) Clover application. While younger than Square’s payment solution, the latter is already processing more payments across the US, and importantly, growing at a faster pace.
CAPITALCOM:LULU
by BlackBull_Markets
NETFLIX"Netflix Inc. overtook Walt Disney Co. in market value for the first time since last year after the amusement park owner's earnings stoked concerns about slowing subscriber growth in its streaming business." (1) Right now, Netflix is in the Top 5 list of producers of original television and movies. After titles such as Squid Game, Stranger Things, and more, we saw a great pump in Netflix's value. As NASDAQ announced, the ATH for Netflix is at $690.31, our most substantial resistance level. NASDAQ is also showing Strong Buy Volumes for Netflix, which shows solid support for its value. My research showed that Netflix has the potential to reach the $1000 levels (or close to that area), so it's safe to say that we have the chance to break this resistance after a few retests. Use this chart as your trade setup for now; I'll keep it updated. Current Market Price: $682.61 Let me know your ideas. Good luck. Citation: (1) "Netflix Is Closing In on Disney Again In Terms of Market Value." finance.yahoo.com
NASDAQ:NFLX
by ShawnMCR
3
NFLX- POST TRADE ANALYSIS- JournalEveryone has different time horizons, goals, and trading strategies. It's essential to know the strategy of the person you are following. If they are a day-trader and you are a position trader, then their entries and exits won't make sense to you. I prefer to be a position-trader, but this current market has temporarily turned me into a swing-trader One of the best ways to become a better trader is post-trade analysis. When I am on top of my game in a perfect world, I take a snap-shot of the chart when I put the trade on. And a snap-shot when I sell. If I don't have time to do this, I might want to choose a different hobby. :-) Even though I was in profit on this one, I felt the chance of going higher did not outweigh the risk of a pull-back since it seemed extended to me. I am happy with my decision. 10/21/2021 NFLX 652.1299 11/1/2021 NFLX 680.02 EDUCATIONAL PURPOSES; NOT INTENDED AS TRADING ADVICE.
NASDAQ:NFLXLong
by Tea-Trades
1
Netflix Analysis 30.10.2021Hello Traders, welcome to this free and educational analysis. I am going to explain where I think this asset is going to go over the next few days and weeks and where I would look for trading opportunities. If you have any questions or suggestions which asset I should analyse tomorrow, please leave a comment below. If you enjoyed this analysis, I would definitely appreciate it, if you smash that like button. Thank you for watching and I will see you tomorrow!
NASDAQ:NFLX
by basictradingtv
2