Netflix Stock Gains on Ad-Supported Plan Pricing

The equity remains down more than 60% in 2022

Deputy Editor
Aug 29, 2022 at 9:55 AM
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The shares of Netflix Inc (NASDAQ:NFLX) are up 2.3% at $228.35 this morning, after the streaming service revealed plans to price its new ad-supported streaming option from $7 to $9 per month. In comparison, the company's most popular ad-free plan at the moment costs $15.49 per month. 

Analysts are all over the place in their recommendations for NFLX at the moment. Coming into today, 19 members of the brokerage bunch rated the equity a "hold," compared to six "sell" or worse ratings, and seven "strong buy" ratings. Meanwhile, the 12-month consensus target price of $256.23 is a 15.6% premium to last night's close. 

At the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), puts are being picked up at a faster-than-usual clip. The security sports a 50-day put/call volume ratio that sits higher than 88% of readings from the past year, meaning puts have rarely been more popular during this time period. It's worth noting that the equity's Schaeffer's Volatility Scorecard (SVS) tally of 97 out of 100 suggests it tends to outperform options traders' volatility expectations.

The $220 level has served as floor for Netflix stock for the entirety of August, while the descending 100-day moving average just moved in as an additional layer of support. Still, year-to-date, NFLX is off by more than 63%.


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