TLDR
- Netflix reports Q2 2026 earnings after market close Thursday, with analysts expecting EPS of $0.79 and revenue of $12.58 billion
- NFLX stock is down 21% year-to-date to $73.78, while the S&P 500 is up 11%
- The stock trades at 19.9x forward earnings — well below its five-year average of 32.4x
- Guggenheim flagged Netflix as the top short idea heading into Q2 earnings, while reiterating a Buy rating with a $120 price target
- Key concerns include engagement trends, AI-driven content disruption, and rising competition from a potential Paramount Skydance–Warner Bros. Discovery merger
Netflix has a lot riding on Thursday’s earnings report. The stock has taken a beating in 2026, and investors want answers.
Netflix is set to report Q2 2026 results after the bell Thursday. Wall Street expects adjusted EPS of $0.79 on revenue of $12.58 billion, according to FactSet — a 13.5% revenue increase year-over-year.
The stock hit a record closing high of $133.91 on June 30, 2025. Since then, it has fallen roughly 45%, and is now down 21% year-to-date to $73.78.
NFLX currently trades at 19.9x forward earnings. That is well below its five-year average of 32.4x, which makes the stock look cheap on paper.
Guggenheim reiterated its Buy rating and $120 price target ahead of earnings, but also noted that Netflix ranked as the top short idea in its survey data heading into Q2.
BofA Securities analyst Jessica Reif Ehrlich also holds a Buy rating with a $125 price target. She wrote Tuesday that investor sentiment is “muted,” and that a beat-and-raise quarter “could go a long way” in calming concerns.
Morgan Stanley and KeyBanc both lowered their price targets — to $90 and $92 respectively — while keeping Overweight ratings. Both cited engagement concerns and long-term growth challenges.
Evercore ISI maintained an Outperform rating with a $115 target, projecting Netflix will meet guidance. Rosenblatt held a Neutral rating with a $95 target.
The Competition Problem
Paramount Skydance beat Netflix in a bidding war to acquire Warner Bros. Discovery. If that deal clears regulatory hurdles, it would create a new heavyweight in streaming.
Beyond traditional rivals, TikTok and YouTube are eating into viewing time. Netflix is responding with short-form clips, video podcasts, and always-on channels — but it’s unclear if subscribers want Netflix to look more like YouTube.
Guggenheim is watching the TF1 partnership launch, expanded short-form and podcast rollouts, and the July 13 MLB Home Run Derby as indicators of how new content initiatives are landing.
The 2030 Framework
A key question for investors: does Netflix’s 2030 growth framework still hold? That plan, reported by the Wall Street Journal in April 2025, targeted $78 billion in revenue, $9 billion in advertising, $30 billion in operating income, a 38% operating margin, and 410 million members.
Netflix also authorized a $25 billion buyback following the failed WBD bid. Management had described WBD as a “nice to have,” and said Netflix has developed its “M&A muscle.”
Guggenheim estimates 2026 adjusted EPS at $3.24, excluding the WBD termination fee, putting the stock at roughly 1.2x PEG ratio.
Ehrlich said she expects NFLX to perform well longer term, driven by subscriber momentum, advertising growth, and live content opportunities.
Netflix reports after market close Thursday.
Stop guessing and start investing with confidence. KnockoutStocks gives you the AI insights, market intelligence, and stock research you need to spot opportunities, cut through the noise, and make smarter investment decisions — all in one powerful platform.
Sign up today and get 50% OFF full access to our premium stock picks.
Simply use coupon code SPECIAL50 at checkout to claim your exclusive discount.
Get 3 Free Stock Ebooks
Discover top-performing stocks in AI, Crypto, and Technology with expert analysis.
- Top 10 AI Stocks - Leading AI companies
- Top 10 Crypto Stocks - Blockchain leaders
- Top 10 Tech Stocks - Tech giants
