Netflix (NASDAQ: NFLX) is scheduled to report its quarterly earnings Tuesday afternoon, with options markets signaling a potentially significant move in either direction for the stock.
Current options pricing suggests Netflix shares could swing as much as 9% by the end of the week following the results, based on trader positioning ahead of the announcement.
A downward move of that magnitude from Friday’s closing price could send shares to $64, a level that would represent a two-year low for the streaming giant.
Conversely, a 9% rally from the same starting point would lift shares to approximately $77, helping recover a portion of Netflix’s steep losses accumulated over recent months.
Netflix shares have declined 25% since the start of the year, weighed down by investor concerns over engagement trends and slowing revenue growth across its platform.
Compounding those concerns, Netflix moved to cut approximately 6% of its workforce, roughly 1,000 employees, ahead of the quarterly report, a signal that management is focused on tightening costs.
Analysts at Morgan Stanley trimmed their price target on the stock to $80 from $83, though they maintained an “overweight” rating, pointing to what they described as green shoots from fresh content and licensing deals.
On the financial performance front, Netflix is expected to post a 12% year-over-year rise in revenue, according to Visible Alpha estimates, suggesting growth continues even as its pace moderates.
Earnings per share are forecast to come in at 82 cents, a notable improvement compared to the 59 cents per share recorded during the same quarter a year ago, per Visible Alpha data.
Wall Street remains broadly constructive on the stock despite this year’s underperformance, with 14 of the 18 analysts tracked by Visible Alpha carrying a “buy” rating on shares.
Only one analyst currently holds a “sell” rating on Netflix, while three maintain neutral positions, reflecting a community that sees the current weakness as a potential opportunity rather than a structural problem.
The consensus mean price target among those analysts stands at $94, which would imply approximately 33% upside from where Netflix shares closed on Friday.
