Netflix, Inc. (NASDAQ:NFLX) facing a unique new challenger in Walt Disney

Netflix, Inc. (NASDAQ:NFLX) facing a unique new challenger in Walt Disney

Netflix, Inc. (NASDAQ:NFLX) facing a unique new challenger in Walt Disney

Netflix (NASDAQ: NFLX) stock has been one of the best-performing names for the past decade. Netflix stock is up more than 6,000% since 2009, and the company’s long-term growth outlook is as strong as ever.

However, this year, Netflix is facing a unique new challenger in Walt Disney (NYSE: DIS). Disney recently announced its highly anticipated streaming service, Disney+, will be launching in November. Disney+ will be a direct competitor to Netflix, offering the entire Disney content library at an extremely low $6.99 monthly price.

Some Netflix stock bulls are starting to get nervous about the potential impact Disney+ could have on Netflix’s subscriber count. However, a new survey by research firm Piper Jaffray suggests Disney will likely not be a real threat to Netflix anytime soon.

Survey Says…

It’s understandable that the owners of Netflix stock would be a bit uncomfortable about Disney+ given Disney’s long-term track record of success in the media business. In addition, some experts have made predictions about Disney+ that are probably scary for the owners of NFLX stock.

In April, a survey by Streaming Observer found that 14.5% of current Netflix subscribers are considering cancelling their Netflix subscription in favor of Disney+. Those survey results are certainly troubling for NFLX. Based on the most current numbers, 14.5% of current Netflix subscribers represent about 9 million customers. If they all jump ship for Disney+, Netflix’s monthly revenue would take a $116.9 million hit.

However, the latest Piper Jaffray survey of 1,536 U.S. Netflix subscribers is much less bearish for Netflix stock. Piper Jaffray found 73% of Netflix subscribers have no intention of getting a Disney+ subscription at all. In addition, 20% of Netflix subscribers intend to have subscriptions to both services.

Consequently, just 7% of current Netflix subscribers intend to cancel their Netflix subscription in favor of Disney+. It’s worth noting that the sample size of the Piper Jaffray survey was more than twice the size of the Streaming Observer survey.

Overall, the bias in prices is: Upwards.

The projected upper bound is: 380.79.

The projected lower bound is: 337.82.

The projected closing price is: 359.30.

Candlesticks

A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 5 white candles and 5 black candles. During the past 50 bars, there have been 27 white candles and 23 black candles for a net of 4 white candles.

Momentum Indicators

Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.

Stochastic Oscillator

One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 46.6487. This is not an overbought or oversold reading. The last signal was a buy 1 period(s) ago.

Relative Strength Index (RSI)

The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 46.95. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a sell 81 period(s) ago.

Commodity Channel Index (CCI)

The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is -44. This is not a topping or bottoming area. The last signal was a buy 0 period(s) ago.

MACD

The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a sell 6 period(s) ago.

Rex Takasugi – TD Profile

NETFLIX INC closed up 4.320 at 359.310. Volume was 25% below average (neutral) and Bollinger Bands were 11% narrower than normal.

Open High Low Close Volume___
356.370 364.000 353.935 359.310 6,441,463

Technical Outlook
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bullish

Moving Averages: 10-period 50-period 200-period
Close: 362.75 364.01 336.33
Volatility: 38 38 54
Volume: 6,217,133 7,231,855 10,473,305

Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.

Summary

NETFLIX INC is currently 6.8% above its 200-period moving average and is in an downward trend. Volatility is relatively normal as compared to the average volatility over the last 10 periods. Our volume indicators reflect volume flowing into and out of NFLX.O at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bearish on NFLX.O and have had this outlook for the last 4 periods.

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