Wall Street is closely monitoring Netflix ahead of its second-quarter earnings report, which is set to be released after market hours on Thursday. NYSE insider Jay Woods highlighted that the stock has been significantly underperforming, having fallen 40% over the past year due to disappointing forward guidance, uncertainties surrounding its bid for Warner Bros.
Discovery, and the departure of co-founder Reed Hastings. Woods indicated that if Netflix's stock price falls below $70, it could signal a major breakdown, with a potential drop to $57 on a long-term basis. He also noted that the stock has historically sold off after earnings reports, raising concerns about the upcoming results.
If the earnings report fails to meet market expectations, further declines could ensue before any recovery. Woods mentioned that a relief rally could push the stock into the early $80s, but the sustainability of such a rally remains uncertain.
Additionally, Woods is watching other significant events this week, including earnings reports from Johnson & Johnson and Fifth Third Bancorp, as well as key economic data releases that could influence Federal Reserve policy