In the midst of unprecedented economical fallout from the COVID-19 crisis that has halted society to a standstill, there are some entertainment companies that are in better shape than others. In a turn of events that would have seemed unfathomable just a year ago, Netflix’s stock has topped that of friendly rival Disney after reaching record highs on Wednesday.
Per Variety, Netflix’s stock closed up 3.2%, to $426.75 per share, topping Netflix’s previous all-time high of $418.97 on July 9, 2018. That gives Netflix a current market capitalization of $187.3 billion, putting it just over Disney’s $186.6 billion, after the media conglomerate’s stock finished down 2.5% amid a broader market decline Wednesday. While both Netflix and Disney have benefited from the increased interest in streaming during this period of quarantine, Disney has suffered greatly from the closure of their parks and delays of their biggest movies.
Variety reported the following concerning Netflix’s projected growth and value in 2020:
Netflix is scheduled to report first quarter 2020 earnings next Tuesday, April 21, after market close. It previously forecast total paid net adds of 7.0 million worldwide. Many analysts expect Netflix to gain more than that.
Pivotal Research Group now expects Netflix to net 8.45 million new subscribers for Q1. In a note Wednesday, analyst Jeffrey Wlodarczak raised his price target on the stock from $425 to $490 per share. “We believe the unfortunate COVID-19 situation is cementing NFLX’s global [direct-to-consumer] dominance partly driven by the incremental content spend that is enabled by their massive and growing subscriber base,” Wlodarczak wrote.
Cowen & Co. more conservatively estimates overall 7.1 million net new Netflix paid subscribers (including 772,000 in the U.S. and Canada) for the first three months of 2020.
“We expect a strong [quarter] driven by a solid slate of originals coupled with a captive audience due to the COVID-19 pandemic,” lead analyst John Blackledge wrote in an April 15 note. Cowen also raised the price target on Netflix stock, from $425 to $445 per share.
While Netflix is not expected to reign over Disney once the behemoth is back to normal operations on all fronts, they are sure to be happy to claim victory over Disney, even if only for a little while. During this time of quarantine, have you been spending more time with Netflix or Disney+? Let us know over on Twitter!
Dillon is most comfortable sitting around in a theatre all day watching both big budget and independent movies.