Netflix Soars to All-Time High: 5 ETFs to Ride the Surge

Netflix NFLX has reached a historic milestone, with its stock price soaring to an all-time high of nearly $1,101. This surge reflects the company’s robust performance and investor confidence in its growth trajectory, solidifying its position as a leader in the streaming industry. The solid trend is likely to continue given the company’s trillion-dollar ambition and analysts’ increasing target price.Investors seeking to tap the bullish trend should invest in ETFs with the largest allocation to this streaming giant. These are First Trust Dow Jones Internet Index Fund FDN, FT Vest Dow Jones Internet & Target Income ETF FDND, MicroSectors FANG+ ETN FNGS, Invesco Next Gen Media and Gaming ETF GGME, and Communication Services Select Sector SPDR Fund XLC.What’s Driving Netflix Higher?Robust Q1 EarningsThe world's largest video-streaming company outpaced earnings estimates but slightly missed revenue estimates. The company reported earnings per share of $6.61, which outpaced the Zacks Consensus Estimate of $5.69 and the year-ago earnings of $5.29. Revenues rose 13% year over year to $10.54 billion but were slightly below the consensus estimate of $10.55 billion. Netflix offered an upbeat outlook for the ongoing quarter. It expects revenues to grow 15% year over year to $11.04 billion, while earnings per share are expected to rise 44% to $7.03. The guidance is above the Zacks Consensus Estimate of $10.96 billion for revenues and $6.22 for earnings per share at the time of issuing the guidance (read: ETFs to Tap Netflix's Q1 Earnings Beat, Solid Growth Outlook).The company launched its in-house ad tech platform on April 1, with international expansion beginning this quarter. Management expects advertising revenue growth to double in 2025, signaling confidence in this relatively new business segment. Netflix reaffirmed its full-year revenue guidance of $43.5-$44.5 billion. Trillion-Dollar StrategyNetflix aims to reach a market capitalization of $1 trillion by the end of the decade, a significant leap from its current valuation of approximately $466.8 billion. The company plans to double its annual revenues from $39 billion to $80 billion, fueled by its burgeoning ad-supported subscription model and international market expansion. Netflix also forecasts its global advertising revenues to grow to $9 billion by 2030.Netflix’s growth strategy includes expanding its content library, developing live programming options, enhancing its gaming division and building its advertising business. With total subscribers of more than 300 million, the company aims to increase this subscriber base to approximately 410 million by 2030 by focusing on international markets, such as India and Brazil, for much of this expansion.Defensive PlayNetflix has been viewed as a safe haven amid economic uncertainty created by President Donald Trump’s tariff policy. Its low-cost advertising-supported service plan should give it more resilience if the macroeconomic climate worsens, as tariffs will not directly impact TV shows and films (read: Inside Trump Tariffs and Their Impact on Sector ETFs). Analysts Lift Target PriceMost of the analysts raised the target price on Netflix this week, signaling bullish trends. Analysts from Morgan Stanley and Wedbush raised their price targets to $1,200 from $1,150, while Piper Sandler increased its target by $50 to $1,150. KeyBanc, Goldman Sachs, JP Morgan and Deutsche Bank also lifted their targets to $1,070, $1,000, $1,150 and $900, respectively, from the previous levels of $1,000, $955, $1,025 and $875.Following the earnings announcement, Guggenheim raised the target price from $1,100 to $1,150 while BMO Capital increased its target price to $1,200, highlighting the “multi-year durable ad growth opportunity” ahead. MoffettNathanson, Oppenheimer and Pivotal Research raised the price target to $1,150, $1,200 and $1,350, respectively, from $1,100, $1,150 and $1,250.Even cautious analysts like Barclays lifted the target price on Netflix to $1,000, noting that the streaming giant has become a “defensive long” investment in the current economic environment.ETFs in FocusFirst Trust Dow Jones Internet Index Fund (FDN): Netflix occupies the top spot at 10.6%. FT Vest Dow Jones Internet & Target Income ETF (FDND): Netflix occupies the top position at 10.7% share.MicroSectors FANG+ ETN (FNGS): Netflix accounts for nearly 10% share in the basket.Invesco Next Gen Media and Gaming ETF (GGME): Netflix is the top firm, accounting for 9.6% of the GGME assets.Communication Services Select Sector SPDR Fund (XLC): Netflix takes the third position at 7.5% share. Want key ETF info delivered straight to your inbox?Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week.Get it free >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Netflix, Inc. (NFLX): Free Stock Analysis Report First Trust Dow Jones Internet ETF (FDN): ETF Research Reports Communication Services Select Sector SPDR ETF (XLC): ETF Research Reports MicroSectors FANG+ ETN (FNGS): ETF Research Reports Invesco Next Gen Media and Gaming ETF (GGME): ETF Research ReportsThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks