Netflix ETFs to Purchase on Strong Q3 Earnings

Netflix NFLX reported sturdy third-quarter 2024 outcomes after the closing bell on Thursday. The world’s largest video-streaming firm outpaced earnings and income estimates and provided an upbeat steering. Shares of Netflix jumped as a lot as 5.4% in after-market hours.

Buyers might faucet the opportune second by ETFs with the most important allocation to this streaming big. These funds embrace MicroSectors FANG+ ETN FNGS, Invesco Subsequent Gen Media and Gaming ETF GGME, First Belief Dow Jones Web Index Fund FDN, Communication Providers Choose Sector SPDR Fund XLC and First Belief S-Community Streaming & Gaming ETF BNGE.

Q3 Earnings in Element

The corporate reported earnings per share of $5.40, which outpaced the Zacks Consensus Estimate of $5.09 and improved 45% from the year-ago quarter. Revenues rose 15% yr over yr to $9.82 billion and had been above the consensus estimate of $9.77 billion.

The streaming big added 5.1 million subscribers within the third quarter, marking a 14% improve from the year-ago quarter and taking the worldwide membership to 282.7 million subscribers. Subscriber progress was pushed by the recognition of sequence like “The Good Couple,” “No one Desires This,” and “Tokyo Swindlers,” together with returning favorites like “Emily in Paris” and “Cobra Kai.” Hit films reminiscent of “Beverly Hills Cop: Axel F” and “Insurgent Ridge” additionally drew subscribers throughout the quarter.

Netflix tasks continued subscriber progress within the fourth quarter, given the discharge of the second season of the hit present “Squid Sport,” dwell sports activities occasions reminiscent of a boxing match between Jake Paul and Mike Tyson, in addition to two Nationwide Soccer League video games on Christmas Day. Additional, the corporate can also be set to turn into the official broadcaster of TKO Group’s (TKO) WWE skilled wrestling occasions beginning subsequent yr as Netflix expands its sports activities choices (learn: 5 Stocks Fueling Nasdaq ETF’s Best Week in 2024).

The streaming big expects revenues to develop 15% yr over yr. Netflix expects greater subscriber additions within the fourth quarter in comparison with final yr attributable to a robust content material slate. For the total yr, revenues are anticipated to develop on the greater finish of the earlier 14-15% year-over-year progress steering.

ETFs in Focus

MicroSectors FANG+ ETN (FNGS)

MicroSectors FANG+ ETN is linked to the efficiency of the NYSE FANG+ Index, which is an equal-dollar-weighted index. It’s designed to supply publicity to a bunch of extremely traded progress shares of next-generation expertise and tech-enabled corporations. It holds 10 shares in its basket in equal proportion, with Netflix’s share at 10%.

MicroSectors FANG+ ETN has accrued $378.2 million in its asset base and expenses 58 bps in annual charges. It trades in a average quantity of 141,000 shares a day on common and has a Zacks ETF Rank #3 (Maintain).

Invesco Subsequent Gen Media and Gaming ETF (GGME)

Invesco Subsequent Gen Media and Gaming ETF provides publicity to corporations with vital publicity to applied sciences or merchandise that contribute to future media by direct revenues. It tracks the STOXX World AC NexGen Media Index, holding 88 shares in its basket. Netflix is the fourth agency, accounting for 7.9% of the GGME belongings.

Invesco Subsequent Gen Media and Gaming ETF has amassed $41 million in its asset base and expenses 60 bps in annual charges. It has a Zacks ETF Rank #3.

First Belief Dow Jones Web Index Fund (FDN)

First Belief Dow Jones Web Index Fund follows the Dow Jones Web Composite Index, giving buyers publicity to the broad Web business. It holds about 41 shares in its basket, with Netflix occupying the third spot at 7.7%.

First Belief Dow Jones Web Index Fund is the preferred and liquid ETF within the broad expertise area, with AUM of $6 billion and a median day by day quantity of round 228,000 shares. FDN expenses 51 bps in charges per yr and has a Zacks ETF Rank #1 (Sturdy Purchase) with a Excessive danger outlook.

Communication Providers Choose Sector SPDR Fund (XLC)

Communication Providers Choose Sector SPDR Fund provides publicity to corporations from telecommunication companies, media, leisure and interactive media & companies and has accrued $18.4 billion in its asset base. It follows the Communication Providers Choose Sector Index and holds 22 shares in its basket, with Netflix occupying the fourth place at 5.9% share. About 41.5% of the portfolio is allotted to interactive media & companies, whereas leisure and media spherical off the subsequent two (learn: Verizon to Acquire Frontier Communications: ETFs in Focus).

Communication Providers Choose Sector SPDR Fund expenses 9 bps in annual charges and trades in a median day by day quantity of three.5 million shares. It has a Zacks ETF Rank #2 (Purchase).

First Belief S-Community Streaming & Gaming ETF (BNGE)

First Belief S-Community Streaming & Gaming ETF tracks the S-Community Streaming & Gaming Index and holds 45 shares in its basket. Netflix takes the third spot, accounting for 4.9% of the belongings. From a sector look, leisure takes the most important share at 45.5%, whereas resorts, eating places & leisure, interactive media & companies, and semiconductors & semiconductor gear spherical off the subsequent three spots with double-digit publicity every.

First Belief S-Community Streaming & Gaming ETF has accrued $3.8 million in its asset base and trades in a median day by day quantity of about 3,000 shares. It expenses 70 bps in annual charges.