Category Archives: stocks

Netflix Investors Too Focused On U.S., Missing Global Opportunity

Investor concern about Netflix ’s ( NFLX ) U.S. subscriber growth “is overdone and myopic relative to the company’s global opportunity,” Pacific Crest Securities analyst Andy Hargreaves said in a research report Sunday. Hargreaves reiterated his overweight rating on Netflix stock with a price target of 140. Netflix stock, though, was down nearly 2%, below 104, in morning trading on the stock market today . The Internet television service is scheduled to report first-quarter results after the market close on April 18. Netflix has missed its U.S. subscriber goals in the last two quarters but has beaten its targets for international subscribers during that period. For Q1, Wall Street expects Netflix to add 1.82 million U.S. streaming subscribers and 4.17 million international subscribers. In January, Netflix guided to 1.75 million U.S. streaming subscribers and 4.35 million international subscribers. For Q2, Wall Street is modeling for Netflix to add 690,000 domestic streaming subscribers and 2.83 million international subscribers. “In both quarters, we see the potential for meaningful upside to consensus estimates for international subscribers, which could vastly outsize any potential downside in the United States,” Hargreaves said. “Investors are currently embroiled in a heated debate over a few hundred thousand U.S. subscribers. In the meantime, Netflix’s global expansion creates potential upside that is measured in the millions.” The potential for an international subscriber miss is the biggest risk to Netflix shares because it would cast doubt on the company’s biggest growth opportunity, he said. In the streaming video market, Netflix competes with Amazon.com ( AMZN ), Hulu and other players. Image provided by Shutterstock . RELATED: Netflix, Amazon, Akamai Benefiting From Cable Cord-Cutters Surveys Show Netflix Winning In U.S., Slow Going In Japan

Edwards Lifesciences Soars To New High As Heart Valve Aces Trial

Leading medical-device maker Edwards Lifesciences ( EW ) jumped in early trading Monday, a day after its artificial heart valve passed a hurdle that could greatly expand its market. Edwards conducted a large clinical trial comparing its transcatheter aortic valve replacement (TAVR), Sapien 3, to traditional open-heart surgical valve replacement in patients with aortic stenosis, or shrinking of the aortic valve of the heart, who were characterized as “intermediate risk” for open-heart surgery. The study followed up on patients 30 days after surgery and again a year later, and it found that deaths and strokes were both significantly lower in the Sapien group. Sapien 3, which is delivered via catheter through a small incision in the patient’s thigh, was approved in June 2015 for patients who were at high risk if they had open-heart surgery. Adding the intermediate-risk population to the patient pool led several analysts to hike their sales estimates for the product. “We estimate the patient population could increase 50% to 150,000 to 200,000, including intermediate-risk patients,” wrote Canaccord Genuity analyst Jason Mills in a research note, as he raised his price target on Edwards Lifesciences stock to 113 from 95. “We increase our Edwards 2016 sales estimate to $2.796 billion from $2.779 billion and pro forma EPS forecast to $2.72 from $2.68. For 2017, our top-line projection increases to $3.1 billion from $3.06 billion and pro forma EPS to $3.21 from $3.09.” Edwards stock was up 18% in morning trading on the stock market today , hitting a new lifetime high of 106.10. The stock was already doing well, ranking at No. 23 on the IBD 50 and also rating a spot on IBD’s Leaderboard . It’s 27% over an 83.53 buy point, and thus in the profit-taking zone. The news also led analysts to lift their estimates for the entire TAVR market, which is currently split between Edwards’ Sapien and Medtronic ‘s ( MDT ) CoreValve. Leerink’s Danielle Antalffy raised her estimate for the global market in 2021 to $4.8 billion from $4.4 billion. “With Edwards’ Sapien 3 likely the only valve available in the intermediate-risk patient population for at least the next 12 months, we assume the majority of the incremental market opportunity benefit falls to Edwards,” Antalffy wrote in her research note, in which she raised her price target on the stock to 115 from 93. BTIG analyst Sean Lavin upgraded the stock to buy from neutral, with a price target of 115. Medtronic stock was up more than 1% in morning trading, near 76.

Market Lab Report – Premarket Pulse 4/4/16

Major averages had an upside reversal day to close higher on mixed volume after a strong employment report. The report at first pushed markets lower as it moved the Fed closer to hiking rates, but as we stated in our PMP on 4/1/16, Fed Chair Yellen recently acknowledged that global growth is an important factor with respect to any rate hikes as a premature hike could further derail the already fragile global economy. So despite a strong employment report, Yellen’s dovish stance continues to have a bullish impact as it ultimately postpones any rate hikes as long as global growth remains stagnant. Website hosting company GoDaddy (GDDY) had an upside reversal pocket pivot breakout off its handle. GDDY is a leader in its space. Institutional sponsorship has grown in every quarter since the company went public 3 quarters ago, group rank 84.. Advanced surgical system company Intuitive Surgical (ISRG) had an upside reversal pocket pivot, closing at new highs. Pretax margin 40.4%, group rank 58. Upside reversals on higher volume are strong patterns, thus often directly precede higher prices. That said, this bullish action needs to be weighed against buying stocks on weakness closer to their respective moving averages since such stocks may not trade all the way down to such levels.