SAN FRANCISCO (Reuters) – Shares of Netflix fell from record-high territory on Tuesday and were headed for their worst session in five months after a mixed quarterly report failed to impress Wall Street.
The stock fell 3.47% to $142.15, losing momentum after touching a record high in extended trade on Monday following its results, the first March-quarter report from a major US technology company.
Netflix’s earnings exceeded expectations, while slower-than-expected subscriber growth was offset by a better-than-expected forecast for subscriber growth in the current quarter.
Helped by a rally in technology stocks, Netflix has soared 15% this year. The report was not enough to win over investors worried about the stock’s pricey valuation, recently at 110 times expected earnings.
Twenty-four analysts recommend buying Netflix’s stock, while two recommend selling and 15 have neutral ratings.
“The company is likely to continue to experience quarter-to-quarter volatility, as both the pace of subscriber additions and the path to respectable profitability remains difficult to determine,” wrote Dougherty analyst Steven Frankel in a research note, maintaining his neutral rating.
Analysts from Credit Suisse, Canaccord Genuity, Stifel and Wedbush raised their price targets for Netflix.
The stock on Tuesday was headed for its worst one-day dip since November 10, when investors abandoned many technology stocks and turned to sectors expected to benefit more from President-elect Donald Trump’s campaign promises.
(Reporting by Noel Randewich; Editing by Nick Zieminski)