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Netflix Stock Could Soon Stage a Rebound

The stock pulled back from last month's record highs, but has support in place

Deputy Editor
Jan 7, 2025 at 2:26 PM
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Streaming giant Netflix (NASDAQ:NFLX) has pulled back from its recent Dec. 11 record high of $941.75, last seen down 0.3% at $879.32 and headed for its seventh loss in the last eight days. The shares are still up 81.2% year over year, however, and could soon bounce back from their short-term drop. 

Per Schaeffer's Senior Quantitative Analyst Rock White, NFLX is within striking distance of its 50-day moving average after a lengthy period above it (defined by White as 80% of the time over the past two months and 8 of the last 10 trading days). The stock has seen eight similar signals over the past three years, after which it was higher one month later 63% of the time with an average 4.6% gain. 

NFLX January7

There is plenty of room for upgrades that could give the stock a boost, as 17 of the 31 analysts in coverage carry a "hold" or worse rating. Plus, the 12-month consensus price target of $858.29 is still a slight discount to current levels, which could bring price-target hikes. 

A shift in the options pits could provide tailwinds as well, as options traders have been more bearish than usual. This is per NFLX's 10-day put/call volume ratio of 1.11 at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), which ranks higher than 97% of readings from the past year. 

Options look like a good way to go when weighing in on Netflix stock, per its Schaeffer's Volatility Index (SV) of 27% that ranks in the 9th percentile of its annual range, meaning options traders are pricing in low volatility expectations. 

 

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