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Soros Fund Management Is Betting on Netflix

Shirley Pelts

Why Has Netflix's Stock Price Risen by 21% in the Last Month?

George Soros bullish on Netflix

On November 24, 2015, TheStreet reported that billionaire investor George Soros’s investment company, Soros Fund Management, owned 318,000 shares worth $32.8 million in Netflix (NFLX). This indicates bullishness regarding the stock on the part of Soros.

TheStreet report also mentioned that other investment companies such as Viking Global and Renaissance Technologies had obtained stakes in Netflix as well.

The stock price of Netflix has risen by ~20% since November 16, 2015, when news of Soros’s investment first broke. It has risen by 21% in the last month. Last month, Netflix announced its 3Q15 earnings.

Netflix’s 3Q15 earnings

Netflix posted revenues of $1.7 billion in 3Q15, a rise of 23% over its revenues in last year’s quarter. Netflix’s revenues met Wall Street analysts’ consensus expectations of $1.8 billion in 3Q15. Netflix ended the third quarter with 69 million members worldwide, and it expects to end the year with 74 million members.

Netflix’s EPS (earnings per share) was $0.07, exactly half of its EPS of $0.14 in 3Q14. The company’s EPS fell slightly short of Wall Street analysts’ consensus expectations of $0.08 per share in 3Q15. However, the company’s internal forecast had accurately predicted its EPS of $0.07 in 3Q15.

You can get diversified exposure to Netflix by investing in the Consumer Discretionary Select Sector SPDR ETF (XLY), which holds 2.2% in the stock. XLY also holds 10.7% in Amazon (AMZN), 5.4% in Comcast (CMCSA), and 7.6% in The Walt Disney Company (DIS).

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