Why Netflix Stocks Are Rising Today

What happened

Part of Netflix (NASDAQ:NFLX) surfaced today, likely after two days of rumors that the company could work with other tech companies to get its hands on an ad-supported streaming service.

It stock video streaming up 5.3% at 1:52 p.m. ET.

Continue

First, investors may be pushing Netflix higher today after AdAge report yesterday said Netflix could partner with Alphabet‘s Google to forge advertising partnerships.

Hand pointing to graphic on phone.

Image source: Getty Images.

Netflix is ​​looking for new ways to increase its subscribers and the company has previously said a tier of ad-supported streaming is in the works. Partner with Alphabet would be a logical choice, considering the company has one of the largest digital advertising platforms.

Investors may have considered the possibility of an Alphabet partnership and paired it with comments made by Needham analyst Laura Martin yesterday about Netflix potentially knocking Roku to promote ad-supported services.

Martin said in an investor note yesterday that Netflix “should buy more Roku ad units to tell the largest base of streaming subscribers what new content is coming to NFLX and why they should watch it.”

Roku has significant global reach — with 61 million devices worldwide — that can help Netflix reach consumers looking for an ad-supported streaming service.

Now what

With Netflix gaining attention over the past few days about potential partnerships with Alphabet and Roku, it’s no surprise the stock is rallying today. It is worth mentioning that nothing has been officially announced by either company.

Netflix shareholders want to keep a close eye on any new developments about the company’s ad-supported rates, especially as rising inflation may lead some consumers to seek cheaper video streaming options.

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Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Chris Neiger does not have a position in any of the shares mentioned. The Motley Fool has the position and recommends Alphabet (A share), Alphabet (C share), Netflix, and Roku. Motley Fool has disclosure policy.

The views and opinions expressed herein are those of the author and do not necessarily reflect the views and opinions of Nasdaq, Inc.

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