Netflix shares news: S&P upgrades its Netflix outlook to ‘positive’

on Feb 23, 2018

Netflix shares closed a little lower in the US on Thursday. However, the outlook for the streaming service is upbeat. At least that’s the view of major ratings agency Standard and Poor’s.

And, although the stock slipped a little Thursday, it did come close to its all-time high towards the end of the Wednesday trading session.

Netflix shares ended the US Thursday trading day 1.03% lower at $278.14. Meanwhile, after-hours trade currently has the Netflix stock in the green ahead of the final trading day of the week.

S&P’s upgrade

Global rating’s agency S&P issued a press release Wednesday, advising of its action to upgrade its outlook for Netflix from ‘stable’ to ‘positive’.

“The outlook revision reflects our expectation that Netflix will continue to demonstrate significant strength as the leading streaming video on demand service despite increasing competition,” S&P said.

“The company's strong EBITDA margin expansion in 2017 demonstrates this strength: it successfully raised prices while achieving accelerated subscriber growth,” S&P’s press release stated.

“The positive outlook reflects our expectation that Netflix will continue to demonstrate improving operating performance and grow its EBITDA margin by close to 300 bps in 2018 while continuing to maintain strong subscriber growth,” it added.

S&P also reaffirmed its ‘B+’ rating on the company.

Netflix impresses investors

As the growing streaming service continues to announce new programming and other agreements, it remains a popular stock among investors, including professional ones.

An investment management unit of Svenska Handelsbanken, Xact Kapitalförvaltning, added to its existing holdings of Netflix stocks in the fourth quarter of 2017. The fund manager boosted its share tally by 6,600 to a total of 76,700 shares.

Considering the stellar performance of Netflix shares so far into 2018, that proved a good move for the group.

Xact also purchased more Coca-Cola and Exxon-Mobil shares. However, it reduced its holdings in Alibaba and Dow DuPont.