Netflix May Find No Business Like Show Business | Sidnaz Blog

[ad_1]

Anya Taylor-Joy and Thomas Brodie-Sangster in a scene from ’The Queen’s Gambit.’



Photo:

/Associated Press

It is as good a time as any for

Netflix

to test a new story line. Even a lucky turn in videogames won’t free the streaming giant from the need to keep playing Hollywood’s game, though.

Netflix used its second-quarter report Tuesday afternoon to confirm previously reported plans to enter the videogame business. No timing was given, though the company said the offerings would be included in its current subscription plans at no additional cost. The company isn’t backing away from its work on movies and TV shows, but said in its letter to shareholders “since we are nearly a decade into our push into original programming, we think the time is right to learn more about how our members value games.”

That news comes as Netflix remains mired in somewhat of a post-pandemic slump. It added 1.5 million net new paying subscribers in the second quarter, which was a bit better than it had forecast but still its lowest level of growth in nearly a decade. It also projected 3.5 million net adds for the third quarter—about 29% less than what Wall Street was hoping for. That would bring the total number of new subscribers to about nine million for the first nine months of 2021. Netflix added more than 28 million paying subscribers in the same period last year.

A foray into games might make sense for a company with an intimate knowledge of the viewing habits of a user base that now numbers over 209 million. It is also a tough business to crack—even the mobile gaming market that Netflix says it expects to target initially. There are many participants, but most of the money is still made by long-established properties. Games like “Candy Crush” and “Clash of Clans” remain in the top-five grossing charts even after nearly a decade on the market.

Netflix will need to keep battling it out for video streaming eyeballs. The company expects its pace of new releases to pick up in the second half of this year; analysts from Wedbush count 42 original shows and movies expected for the third quarter alone. But the company still has its own track record to compete with: Last fall included popular shows such as “The Queen’s Gambit,” “The Crown” and “Bridgerton.” Netflix shares are down nearly 2% this year, lagging behind many internet and entertainment peers. Streaming investors hyper-focused on subscriber growth aren’t playing games.

Write to Dan Gallagher at [email protected]

Copyright ©2021 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8

Appeared in the July 21, 2021, print edition.

[ad_2]

Source link

Tagged : / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / /

Space Race, Nasdaq, IBM, Nvidia: What to Watch When the Stock | Sidnaz Blog

[ad_1]

To the moon! Well, not quite, but into space at least today for

Jeff Bezos,

the billionaire baron of ecommerce. Also not going to the moon is

Amazon


AMZN -0.67%

stock, though it is 0.4% up premarket on Tuesday morning.

  • One reason for Mr. Bezos’s rocket ride is the more earthly goal of winning government contracts for the kind of less thrilling scientific projects the provide reliable revenue. His Blue Origin company is playing catch-up with Elon Musk’s SpaceX.
  • Mr. Musk’s electric vehicle maker

    Tesla,


    TSLA 0.31%

    is getting a bit of a boost Tuesday morning ahead of the open, rising 1% premarket. It is also gaining more attention on the message boards among day traders, according to Topstonks.com. The company reports earnings next Monday and tends to see its stock rise in the days ahead as investors start hoping for exciting announcements.

  • In the wider markets, U.S. stock futures are trending higher ahead of the open following Monday’s broad selloff. S&P 500 futures are up 0.5%, while Dow futures are up 0.6%. Nasdaq-100 futures are up 0.4%
  • Nasdaq the company, not the index, is itself rising premarket, up 1%, after The Wall Street Journal’s exclusive that it will spin out its Private Market for shares in start-ups that trade among some investors before an initial public offering. The business will go into a standalone joint venture company and get investment from three Wall Street banks and SVB Financial Group, a tech specialist bank.
  • Nvidia


    NVDA 15.18%

    is up 0.8% on large volumes following a 15% rise Monday. The shares are up nearly 80% over the past year, putting the chip maker into the top 10 list of U.S. public companies. It also executed its four-for-one stock split overnight, which has given some investors more ways to trade the stock-performance.

  • International Business Machines


    IBM -0.71%

    is up 3.4% ahead of the open on Tuesday after turning in decent second-quarter numbers Monday after the close. The computing group’s efforts to refocus on cloud-based computing and spin off its old-fashioned IT services business is winning fans among investors. At the same time, it has benefitted from companies beginning to invest again as the economy reopens.

IBM reported earnings on Monday..



Photo:

sergio perez/Reuters

Chart of the Day
  • Stocks, commodities and other financial markets took a stumble Monday on growing concerns about the strength of the post-Covid-19 global recovery.

Copyright ©2021 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8

[ad_2]

Source link

Tagged : / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / /

Blackstone, AIG, NortonLifeLock, Morgan Stanley: What to Watch | Sidnaz Blog

[ad_1]

Futures are mixed ahead of jobless figures and a second day of testimony from Federal Reserve Chairman

Jerome Powell

on Capitol Hill. S&P 500 contracts are down slightly. Nasdaq-100 futures are up, suggesting tech stocks will outperform.

Here’s what we’re watching ahead of Thursday’s trading action.

Prague-based Avast primarily makes free and premium security software, offering desktop and mobile-device protection.



Photo:

david w cerny/Reuters

  • Is the steam coming out of meme stocks?

    AMC Entertainment,


    AMC -15.04%

    one favorite of the Reddit trading crowd, lost 3.7% premarket. If matched once trading begins, the stock would extend a decline of 43% over the past month.

    GameStop


    GME -6.91%

    and

    BlackBerry


    BB -3.79%

    shares have both dropped by almost a quarter in that time.

  • Netflix


    NFLX 1.34%

    shares rose 2.6%. The streaming company, which reached a licensing deal over animated films with Universal this week, has been on a tear of late, gaining 11% for the month through Wednesday.

  • T. Rowe Price


    TROW -0.85%

    shares are up 2.6%. Analysts at Citigroup, Deutsche Bank and Morgan Stanley have raised their target prices for the stock in recent days. T. Rowe said this week it managed $1.62 trillion in assets at the end of June.

  • Supply-chain technology provider

    E2Open Parent


    ETWO -0.73%

    fell 1% after reporting a fall in profit and revenue in its fiscal first quarter from a year before.

Chart of the Day

Copyright ©2021 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8

[ad_2]

Source link

Tagged : / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / /

Netflix Bets on Even Stranger Things | Sidnaz Blog

[ad_1]

A scene from the Netflix show ‘Sexy Beasts.’



Photo:

Netflix

Netflix


NFLX 1.04%

and romance have long been a match made in heaven, but now the streaming giant is taking things to another level.

Perhaps emboldened by the success of recent shows like “The Circle” and “Love Is Blind,” Netflix is now doubling down on dystopian reality dating. According to the trailer, released this week, the new concept will feature “real life singles,” sporting “elaborate makeup and prosthetics” and putting blind date chemistry to the test.

After reporting disappointing subscriber numbers for the first quarter, Netflix needs new alluring content. Analysts expect the streaming giant to add about 15 million subscribers in the second half of the year, nearly three times the number it is forecasting for the first half.

As if dating weren’t already hard enough, contestants on “Sexy Beasts” are expected to find love while looking like a panda or a mouse. The trailer features a suave alien in a bowling alley chatting to his date, an apparent cross between a dolphin and a platypus, stating that “personality, for me, is everything.” Others—especially a beaver who candidly describes his favorite physical feature—are at least honest.

If nothing else, viewers will be in it for catfights.

Write to Laura Forman at [email protected]

Copyright ©2020 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8



[ad_2]

Source link

Tagged : / / / / / / / / / / / / /

Facebook, Alphabet Keep Rising; Apple, Netflix Fade | Sidnaz Blog

[ad_1]

Big tech stocks are going their own ways in 2021.

It is a far cry from last year, when the so-called FAANG stocks took a commanding role in a market driven by the coronavirus pandemic.

This year, as the economy strengthens and vaccinations diminish the pandemic in the U.S., that synchronized march has broken down. Investors have broadened their sights beyond the familiar names whose technology businesses thrived as many Americans switched to working, shopping and socializing at home. With a re-energized economy creating opportunity across industries, money managers have options, as well as renewed scrutiny for stocks whose lofty valuations and widespread popularity could limit further upside.

While Alphabet Class A and Facebook shares are up 37% and 21%, respectively, other members of the group have weighed on the market. Amazon shares are up 7.1% in 2021, lagging behind the 11% rise in the benchmark S&P 500. Apple and Netflix have fared even worse, down 1.7% and 7.4% for the year.

Among the hundreds of S&P 500 stocks outpacing Apple—the U.S. benchmark’s largest company by market value—are many that were hit hard by the pandemic. Cruise company

Carnival Corp.


CCL -0.84%

is up 30% for the year, and

American Airlines Group Inc.

has risen 41%. Other big gainers include almost every member of the energy sector.

Technology stocks that lagged in 2020 are also on the move this year.

Cisco Systems Inc.


CSCO -2.00%

is up 16% so far, and

Intel Corp.


INTC -2.64%

has posted a 12% gain.

“A rising tide is lifting all boats right now,” said

Jim Golan,

co-manager of the William Blair Large Cap Growth Fund. “Just investing in the top four or five big-cap companies probably won’t do it this year.”

Investors this week will scrutinize earnings from delivery giant

FedEx Corp.

, sneaker titan

Nike Inc.

and Olive Garden operator

Darden Restaurants Inc.


DRI -1.37%

for insights into consumer behavior.

With a healthier economy improving prospects for many stocks, investors have less reason to snap up ones that look expensive. That is particularly the case as a spurt of inflation focuses investors on the question of when the Federal Reserve will begin lifting interest rates from current, rock-bottom levels.

An Amazon warehouse. The e-commerce giant helped power the S&P 500 to a 16% gain for 2020.



Photo:

mike segar/Reuters

Fed officials last Wednesday indicated they anticipate raising rates by late 2023, sooner than previously expected. When rates rise, commonly used models show the far-off cash flows factored into many technology stock’s price tags are less valuable.

In recent months, investors haven’t been willing to pay as much for the profits of some of the megacap tech names with the richest valuations. Analyst estimates for Amazon’s per-share profit over the ensuing 12 months rose more than 40% from the end of December through last week, according to FactSet. But since Amazon’s share price rose only 7.1%, the stock’s forward price/earnings multiple contracted from nearly 73 times to about 55 times.

In the case of Netflix, expectations for forward earnings have risen while its share price has fallen. That has compressed the stock’s price/earnings ratio from almost 60 at the end of 2020 to about 43 last week.

Apple has seen its valuation fall since the start of the year, as projected earnings increased while its share price is nearly unchanged. It traded last week at about 25 times expected earnings—down from more than 32 times on Dec. 31.

After owning Apple shares for years,

David Bahnsen,

chief investment officer of wealth-management firm The Bahnsen Group, said he sold them late last year because he thought they were too rich.

For much of 2020, a badly constricted economy pushed investors toward stocks—like the FAANG names—whose businesses were less affected and whose future growth became even more alluring with the drop in interest rates. The Russell 1000 Growth Index advanced 37% for the year, while the Russell 1000 Value Index eked out a 0.1% gain—the largest annual performance gap between the two style benchmarks in FactSet data going back to 1979.

Big tech stocks were among the leaders of that rally. Apple shares climbed 81% in 2020—last August becoming the first U.S. public company to surpass $2 trillion in market value—while Amazon rose 76% and Netflix gained 67%. Facebook added 33% for the year, and Alphabet 31%.

“Philosophically if you’re buying those very large-cap stocks—let’s say a trillion dollars and above—you’re doing so not because you think you’ve found some undiscovered gem,” said

Kevin Landis,

who manages the Firsthand Technology Opportunities Fund. “You’re doing it more as an expression of a tech thesis, that people are going to be rotating to tech.”

That rotation began to unwind in November with news that a Covid-19 vaccine was emerging. Value stocks, which trade at low multiples of book value and tend to be more sensitive to the health of the economy, began a monthslong rally. In March, value stocks were beating growth stocks by the widest margin in two decades, although the gains have eroded recently.

Among big tech stocks, Alphabet and Facebook have served as a kind of reopening play, reporting a surge in advertising. Facebook’s profit in its latest quarter nearly doubled from a year earlier, while Alphabet’s earnings more than doubled.

“They’ve had this huge resurgence in online advertising and that’s really been driving the stocks,” said

Daniel Morgan,

senior portfolio manager at Synovus Trust Co. “All these businesses are reopening, coming back on, the economy’s accelerating. Where do they go to promote themselves? A lot of them go to Facebook.”

SHARE YOUR THOUGHTS

Do you think the performance of the big tech stocks will continue to diverge? Join the conversation below.

Netflix, by contrast, disappointed investors when it reported that its subscriber growth had slowed as the economy reopened. The streaming giant got a boost from the pandemic as many consumers were forced or chose to stay home, and it ended 2020 with more than 200 million subscribers.

Those fundamentals matter more now for investors, who seem less inclined to view the market in the same broad terms as they did last year.

“These just are different companies that for a long time were highly correlated because they were popular, they were performing well,” Mr. Bahnsen said. “There really was never an investment logic to a streaming company that was first to market trading in tandem with a social media company.”

Write to Karen Langley at [email protected]

Copyright ©2020 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8

[ad_2]

Source link

Tagged : / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / /

AT&T Needed to Dial Back Media Dreams | Sidnaz Blog

[ad_1]

A scene from the Warner Bros. Pictures movie ‘Wonder Woman 1984’.



Photo:

Clay Enos/Warner Bros/Everett Collection

AT&T’s


T 1.07%

time as a media giant was fun while it lasted. Well, not for its investors.

The deal the telecommunications giant announced with

Discovery Inc.


DISCB 9.67%

Monday morning begins the process of unwinding Ma Bell’s expensive foray into the world of big media. Under the terms announced, AT&T’s WarnerMedia unit will combine with Discovery to create a new stand-alone media titan expected to generate annual revenue of about $52 billion by 2023. It also will create a more focused—and less indebted—AT&T. Net debt is expected to fall by $43 billion once the deal closes sometime in mid-2022.

Much of those borrowings came from the company’s $81 billion acquisition of Time Warner, which closed barely three years ago. The relatively abrupt about-face can be chalked up to a rapidly changing media landscape in which investors have heavily incentivized Hollywood’s content giants to pour capital into streaming. That created some unique pressures for AT&T, which also has a capital intensive wireless and fiber optic business to run along with a generous dividend to maintain. Investors never warmed to the company’s big media aspirations; AT&T’s stock has badly trailed the broader market since the company announced the Time Warner deal in late 2016. The shares rose 2% Monday morning.

Discovery, meanwhile, has earned some kudos on Wall Street for its efforts to build a more focused streaming offering. Discovery+ launched in the U.S. in January, and

Robert Fishman

of MoffettNathanson estimates the service is already on pace to reach 11 million domestic subscribers by the end of the year. Still—at just under $11 billion in trailing 12-month revenue—Discovery ranks below many other media outlets in scale, including

Fox Corp.

,

ViacomCBS

and

Walt Disney

in terms of scale.

The move isn’t quite a cash out for AT&T. Citigroup analysts noted Monday that the structure of the deal as a tax-free spin limits the amount of cash and deleveraging for AT&T, which said Monday it has “resized” its annual dividend payout ratio to about 40% to 43% of anticipated free cash flow, down from its last-stated goal of a little over 50% of free cash flow. AT&T adds that it will reach its target ratio of 2.5 times net debt to adjusted earnings before interest, taxes, depreciation and amortization by the end of 2023—a year earlier than planned.

The move should still create a cleaner story for AT&T going forward. The company was never going to land the sort of multiples investors have lavished on other media giants diving head first into streaming. And its pressing need to invest in expensive technology like 5G to keep its network business competitive made this a bad time to also keep up with the billions being poured into new streaming content by everyone from Disney to

Netflix

to

Apple Inc.

to

Amazon.com.

For a company that seemingly has been in permanent deal mode since the late ‘90s, unwinding its largest acquisition to date may finally convince Ma Bell to stick to her knitting.

Write to Dan Gallagher at [email protected]

Copyright ©2020 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8

[ad_2]

Source link

Tagged : / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / /

Cathie Wood’s ARK Stumbles as Tech Trade Unwinds | Sidnaz Blog

[ad_1]

Cathie Wood’s

ARK Investment Management LLC is bearing the brunt of the stock market’s faltering technology trade, again.

Ms. Wood was crowned a star stock picker last year thanks to her exchange-traded funds’ hefty exposure to many of the coronavirus pandemic’s work-from-home winners. But her funds have sunk further than the broader market during May’s selloff in shares of technology and other fast-growing companies, suggesting their midwinter pullback was no fluke.

Her flagship innovation fund has fallen 13% in the first eight trading sessions of May. That is more than what the ETF shed in February and March when worries about a sharp rise in bond yields began to dent the allure of growth stocks. Shares of the fund are now down roughly a third from their mid-February high after more than doubling last year.

The Nasdaq Composite, in comparison, has stumbled 5% in May and set a record as recently as April 26, while the S&P 500 is off 1.2% and continues to hover near its record highs.

Many of the stocks that sit in ARK’s funds are unprofitable tech and biotech companies whose lofty valuations are tied to bets that they will one day dominate their industries. Those stocks have stumbled lately on worries about rising inflation and an eventual tightening of monetary policy. The latest sign of inflation came Wednesday when the Labor Department said its consumer-price index jumped 4.2% in April from a year earlier, the highest 12-month level since the summer of 2008.

Analysts and money managers also say there are rampant concerns over the rich valuations of companies that boomed during the pandemic but whose growth now appears unsustainable as the economy moves closer to a full reopening.

“You have a pretty clear trend of the frothiest and costliest corners of the market needing to be repriced,” said

David Bahnsen,

chief investment officer of the Bahnsen Group, a $2.8 billion money-management firm. “And the darlings of 2020 have a ways to go.”

Several of those darlings litter ARK’s funds and have given up a chunk of the large gains they racked up last year.

Tesla Inc.,


TSLA -2.65%

the biggest holding in several of ARK’s funds, has tumbled 14% in May after surging 700% in 2020 and is on track for its first annual decline in five years.

Teladoc Health Inc.,


TDOC -3.75%

Fastly Inc.,


FSLY -7.52%

Twilio Inc.


TWLO -5.15%

and

Crispr Therapeutics AG


CRSP -3.35%

—other pandemic winners that generate little to no profits—are down even more.

Few tech stocks have been left untouched by the selloff. Even the FAANG stocks—

Facebook Inc.,


FB -2.26%

Amazon.com Inc.,


AMZN -2.17%

Apple Inc.,


AAPL -2.27%

Netflix Inc.


NFLX -1.57%

and Google parent

Alphabet Inc.


GOOG -2.89%

—have suffered declines of about 4.3% to 7.8% this month.

The tech behemoths reported blowout earnings for the latest quarter, but many investors say the economic winds have shifted away from the group. For starters, the economy is getting back on firmer footing as more Americans get vaccinated and businesses fully reopen, creating a more conducive environment for a wider variety of stocks to run.

Tesla is the biggest holding in several of ARK’s funds and has tumbled 14% in May.



Photo:

Toru Hanai/Bloomberg News

“The quick money is gone,” said

Max Gokhman,

head of asset allocation at Pacific Life Fund Advisors, which manages $32 billion in assets, of the tech trade. “When growth is abundant in an economy, that’s when lower growth stocks, such as value, do better because you don’t need to pay a premium for growth.”

Mr. Gokhman said Pacific Life’s funds remain tilted toward value stocks, such as regional banks, energy firms and consumer staples that trade at low multiples of their book value, or net worth.

Inflation also appears to be simmering, with analysts and investors pointing to shortages in the labor market, rising commodity costs and a pickup in consumer prices. The Fed’s primary tool for combating inflation is raising interest rates, something the central bank says it has no intention of doing this year or next. Yet, the influx of fiscal stimulus along with near-zero rates has spurred speculation that the Fed might have to act sooner to rein in an overheated economy.

Investors said any chatter about a potential rate increase puts tech stocks on unstable footing, especially after last year’s gangbusters performance. That is because interest rates are a significant variable in often-used valuation models that discount cash flow. Higher rates, under those models, diminish the value of future cash flows, lowering the ceiling on valuation projections.

“The outperformance in megacap tech stocks has likely run its course,” said

Andrea Bevis,

a senior vice president at UBS Private Wealth Management. “We believe the next leg of the equity rally will be driven by value stocks, and small and midcap segments of the market.”

The latest downdraft has cut valuation multiples in half for some of the pandemic’s biggest winners. Tesla shares now trade at 121 times future earnings, down from nearly 220 earlier this year, according to FactSet. Online marketplace

Etsy Inc.,


ETSY -4.87%

whose shares quadrupled last year, trades at 51 times earnings versus more than 100 times in January. Its shares have fallen 17% this month.

Both stocks remain relatively pricey. The S&P 500’s consumer discretionary sector, where the stocks reside, trades at 36 times earnings, while tech is at 25. The S&P 500 stands at 21 times earnings, above its five-year average of 18.

The tech sector’s repricing has shaken billions of dollars out of growth and tech funds, including those run by Ms. Wood. Investors have pulled $1.6 billion from the ARK’s ETFs over the past month, with nearly $600 million coming out of the innovation fund, according to FactSet. That’s on top of about $7 billion investors have pulled from other U.S. growth and tech funds so far this year. Over the same period, more than $30 billion has flowed into U.S. value funds.

Ms. Wood has repeatedly brushed off worries about the losses and outflows, saying the firm invests in stocks for at least five years, and nothing has changed other than their cheaper price tags. In fact, ARK has taken advantage of the selloff to add to its positions in some beaten-down stocks such as

Twitter Inc.,

Peloton Interactive Inc.


PTON -3.48%

and

Roku Inc.


ROKU 1.16%

in recent sessions.

“Many consider what has happened in the last three months to be the beginning of another, or the equivalent of the tech and telecom bust,” Ms. Wood said in a Tuesday webinar. “We do not believe that’s the case in the least. The kinds of growth that we’re going to see coming out of these technologies, we believe, the kind of growth is going to be astonishing.”

Other investors have followed Ms. Wood’s lead—they stepped in to buy the dip in tech stocks Tuesday, helping the Nasdaq erase nearly all of a 2.2% intraday decline by the end of the session. ARK, in this case, tracked the market, with its innovation ETF closing up 2.1%.

But the tug of war in the stock market will likely continue, with several money managers saying they have no intention of leaning back into the tech trade soon.

“I don’t think there’s any place in the tech space where there will be easy growth or cheap growth,” said Mr. Bahnsen. “I believe we’re living in an era that favors cash-flow generating companies.”

Write to Michael Wursthorn at [email protected]

Copyright ©2020 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8

[ad_2]

Source link

Tagged : / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / /

Netflix, Halliburton, CSX, Chipotle: What to Watch When the Stock | Sidnaz Blog

[ad_1]

Here’s what we’re watching ahead of Wednesday’s opening bell.

  • U.S. stock futures wobbled as the global Covid-19 infection rate and potential for new variants led to concerns about the pace of world economic recovery.
  • Futures tied to the S&P 500 and the Dow Jones Industrial Average wavered between gains and losses after two straight days of declines. Technology-heavy Nasdaq-100 futures slid 0.3%. Read our full market wrap.
What’s Coming Up
Market Movers to Watch
  • Netflix

    shares were down more than 8% premarket. Subscriber growth for the first quarter was weaker than expected, a potential warning sign for the company as consumers start to emerge from lockdowns and streaming competition increases.

  • Halliburton

    shares were up 2.3% premarket after the oil-services company delivered its latest quarterly earnings report.

  • Tenet Healthcare

    added 1.7% premarket. The company reported earnings after-hours trading Tuesday and updated its outlook.

  • FuelCell Energy

    shares dropped 3.4% premarket. The stock closed at $8.59 a share on Tuesday, after

    Wells Fargo

    set a price target of $9 a share.

  • CSX

    shares dropped 1% ahead of the bell. The railroad operator’s top line fell in the first quarter and its net earnings declined from a year ago.

A CSX Transportation freight train travels through Covington, Ky., Jan. 13, 2020.



Photo:

Luke Sharrett/Bloomberg News

Market Facts
  • The S&P 500 Real Estate Sector on Tuesday closed at a record for the first time since Feb. 14, 2020. The S&P 500 Energy Sector meanwhile closed in correction territory.
  • Dogecoin, the digital currency created as a joke, pared gains after climbing more than 8,000% this year. By Tuesday, it fell to 31 cents, according to CoinDesk, despite some online users’ efforts to push it to $1 to recognize what some have called “Doge Day.”
  • On this day in 1982, futures contracts on the S&P 500 index became available for the first time, as they opened for trading in the pits of the Chicago Mercantile Exchange. 
Chart of the Day

Apple

added a paid subscription to its podcast app, along with other new products including an updated high-end iPad. Heard on the Street’s Dan Gallagher writes that the new iPad and iMac might seem a bit late to the game, but there is good reason to think they will still find their mark.

Must Reads Since You Went to Bed

Corrections & Amplifications: Whirlpool’s quarterly earnings are due out after Wednesday’s close. An earlier version of this article incorrectly said they would be out before the open.

Copyright ©2020 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8

[ad_2]

Source link

Tagged : / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / /

Netflix Will Need Some Post-Summer Blockbusters | Sidnaz Blog

[ad_1]

A scene from the Netflix show “Bridgerton.”



Photo:

Liam Daniel/Associated Press

The shows

Netflix


NFLX -0.88%

has coming later this year had better be really good.

The streaming giant reported disappointing growth in paid subscribers for the first quarter on Tuesday. That alone should not have been a huge surprise; Netflix has missed its own subscriber forecasts about 44% of the time since it instituted its current projection methodology in early 2019. The company has also repeatedly warned that the breakneck expansion fueled by the pandemic last year pulled forward growth from this year.

Still, Netflix shares slumped nearly 9% in after-hours trading following the results. The company added slightly under 4 million paid subscribers in the first quarter and projected net additions of just 1 million for the second quarter. That means it could end the first half of the year nearly 6 million subscribers short of where Wall Street thought it would be by that time. Netflix would also require the addition of nearly 21 million subscribers in the second half of 2021 to reach analysts’ year-end target of 229.4 million. Over the past five years, Netflix has averaged about 12.4 million net new subscribers during the second half of the year.

In its quarterly shareholder letter Tuesday, Netflix blamed part of this year’s lag on a “lighter content slate” caused by last year’s pandemic-related production shutdowns. The company expects that situation to improve; the latter half of 2021 will see new seasons of “The Witcher” and “Cobra Kai,” and some expect a new season of the company’s blockbuster series “Stranger Things” in that period as well. Of course, the many Netflix competitors now in the market will be executing on similar plans. What’s more, rivals like

Disney

and HBO Max will be adding some movies to their streams on the same day as theatrical release.

Netflix did maintain its goal of breaking even on a free-cash-flow basis this year. The company even plans to start buying back stock for the first time since 2012; a $5 billion repurchase program gets under way this year. All are important steps for the undisputed streaming king after more than a decade in the business. But with streaming investors myopically focused on subscriber counts, Netflix will still need a lot of viewers to find their way back indoors later this year.

Write to Dan Gallagher at [email protected]

Copyright ©2020 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8

[ad_2]

Source link

Tagged : / / / / / / / / / / / / / /

IBM, United Airlines, Tesla: What to Watch When the Stock Market | Sidnaz Blog

[ad_1]

Here’s what we’re watching ahead of Tuesday’s opening bell.

  • Stock futures slipped, a day after faltering tech stocks dragged major indexes lower
  • Futures on the S&P 500 and the Dow Jones Industrial Average fell 0.4% apiece. Tech-heavy Nasdaq-100 futures slipped 0.3%.
  • 10-year Treasury yields are higher at 1.625%, from 1.599% on Monday. The dollar slipped again. Crude-oil prices are rising ahead of stockpile data from the American Petroleum Institute. Read our full market wrap here.
What’s Coming Up
Market Movers to Watch

The Johnson & Johnson campus in Irvine, Calif., Aug. 26, 2019.



Photo:

Mario Tama/Getty Images

Market Facts
  • By the end of Friday, S&P 500 companies that had already reported quarterly earnings had beaten profit expectations by a combined 30%, according to FactSet, compared with a five-year average of 7%.
  • Through Thursday, healthcare stocks have returned about 7% so far this year. That lags behind the S&P 500 by about 5 percentage points.
  • On this day in 1720, declaring that he “can calculate the motions of the heavenly bodies, but not the madness of the people,” Isaac Newton sold his 7,000 pounds’ worth of South Sea Co. stock at a 100% profit. But the excitement around England’s first great IPO proved too much even for him, and he soon got back in. Newton ended up losing 20,000 pounds when the bubble burst, and from that moment on, he could “never bear to hear the South Sea referred to for the rest of his life.”
Chart of the Day

European carbon credits are as close as investors can come to a sure thing. Ironically, the chief thing that might trip them up is too much excitement too soon, writes Heard on the Street columnist Rochelle Toplensky.

Must Reads Since You Went to Bed

Copyright ©2020 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8

[ad_2]

Source link

Tagged : / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / /