Goldman Sachs Hikes Netflix Stock Price Target by 26%

As a reminder, Netflix stock has historically been a strong summer performer

Jun 13, 2018 at 9:22 AM
facebook X logo linkedin

Goldman Sachs just set the highest price target on Wall Street for streaming giant Netflix, Inc. (NASDAQ:NFLX). The analyst in coverage boosted his price target to $490 from $390, foreseeing the company becoming cash flow positive by 2022, while expecting subscriber growth to continue to come in above expectations. This new price target represents an almost 35% premium to NFLX stock's Tuesday close of $363.83.

Of course, if the shares continue their recent upward trajectory, that target could be taken out sooner than expected. The security is already up close to 90% in 2018, touching an all-time high of $369.83 on June 5. Not to mention, NFLX has historically outperformed during the summer months. At the same time, the equity's 14-day Relative Strength Index (RSI) hit 70 at yesterday's close, meaning it's technically overbought -- though that hasn't stopped it from rising 1.3% in electronic trading. 

Options data suggests traders may be taking a cautious approach in the near term. For example, Netflix has a Schaeffer's put/call open interest ratio (SOIR) of 1.13, showing put open interest outweighs call open interest among contracts expiring within three months. Moreover, this reading ranks in the high 88th annual percentile, so such a put-skew is unusual.

Nonetheless, it's a good time to target near-term NFLX options. The FAANG stock's Schaeffer's Volatility Index (SVI) is just 36%, ranking in the bottom quartile of its annual range, which hints at lower-than-normal volatility expectations at the moment. Plus, Netflix's Schaeffer's Volatility Scorecard (SVS) of 96 reveals a strong tendency to make moves bigger than the options market was expecting.


Target Effortless Triple-Digit Gains Every Sunday Evening For Life!

This is your chance to triple your profit potential on Sunday evenings, without spending all your free time watching the market.

On Sundays, as a Weekend Plus subscriber, you’ll get up to 6 trades every Sunday, each targeting gains of 200% or more.

Start targeting gains like the ones our subscribers have seen recently, including:

213.3% GAIN on AutoNation calls
100.0% GAIN on Monster Beverage calls
100.4% GAIN on Walgreens Boots Alliance puts
100.4% GAIN on ON Semiconductor calls
257.7% GAIN on Dell calls

101.0% GAIN on Apollo Global Management calls
103.6% GAIN on JP Morgan  Chase calls
105.3% GAIN on DraftKings calls
101.3% GAIN on Airbnb calls
203.0% GAIN on Shopify calls
102.0% GAIN on Cboe Global Markets calls
100.9% GAIN on Boeing calls
102.1% GAIN on Microsoft puts
102.3% GAIN on First Solar calls
101.5% GAIN on PulteGroup calls
101.0% GAIN on Apple calls
209.4% GAIN on NXP Semiconductors calls
100.8% GAIN on Uber Technologies calls
100.4% GAIN on Academy Sports and Outdoors puts
102.2% GAIN on Trade Desk calls
100.8% GAIN on DoorDash calls
100.0% GAIN on Camping World Holdings puts
100.0% GAIN on Cboe Global Markets calls
100.2% GAIN on calls
238.5% GAIN on Oracle calls



Rainmaker Ads CGI