Traders are betting on a comeback quarter for Netflix
Options traders are showing bullish sentiment toward Netflix ahead of its upcoming earnings report, despite a year of stock decline and concerns over a lack of breakout hits. Analysts note that the stock is testing key technical support levels, though viewership engagement metrics remain a point of concern.
Why it matters
Netflix's performance is a key indicator for the broader streaming industry and investor confidence in the media sector.
After a year-long bear market, an almost 20% decline year-to-date, and sell-offs after four of its past four earnings reports, options traders are striking a decidedly bullish tone heading into Netflix 's earnings on Thursday. Call volumes doubled puts in back-to-back sessions Friday and Monday, with almost three times as many calls bought versus puts by midday Monday, according to data from ThinkOrSwim. At the same time, one of the most popular trades was selling at-the-money puts. The technical picture may be helping. At around $75, Netflix is trading about on par with where the stock was when it ended its pursuit of Warner Brothers Discovery in February. It was around this level in late 2021 that Netflix began a sharp, 80% selloff before a multi-year recovery that peaked at $134 in June last year.
The report balances market speculation with objective data from analysts and Nielsen.
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