Netflix (NFLX, $332.67) Will Issue $2 Billion In Additional Debt - Will It Aggravate Negative Cash Flow Concerns?
On Monday, Netflix announced that it will issue new debt of $2 billion.
As the online video-streaming giant continues to up the ante on content (up to $8 billion could be spent on content this year) amidst prolonged cash outflows, the company seems to be relying on even more debt to for its operations. Through the nine months ended Sept. 30, its free cash flow was a negative $1.7 billion. Netflix now has more than $10 billion in long-term debt obligation - compared to $8.3 billion at the end of the third quarter and $6.5 billion at the end of 2017. This year’s interest costs (excluding those on the latest debt issue) has climbed to $291 million from $238 million of full year 2018.
However, Netflix chief financial officer David Wells tried to sprinkle some hope for investors during the third-quarter earnings call with analysts where he said, “Netflix is approaching a point where the growth in operating profit is going to grow faster than our growth in content cash spend, and that’s really going to drive the free cash flow towards improvement – it will eventually break even,” and added that he projects a “material improvement” in cash flow by 2020.
NFLX in +1.56% Uptrend, advancing for three consecutive days on September 09, 2025
Moving higher for three straight days is viewed as a bullish sign. Keep an eye on this stock for future growth. Considering data from situations where NFLX advanced for three days, in of 330 cases, the price rose further within the following month. The odds of a continued upward trend are .
Technical Analysis (Indicators)
Bullish Trend Analysis
The Stochastic Oscillator demonstrated that the ticker has stayed in the oversold zone for 1 day, which means it's wise to expect a price bounce in the near future.
The 10-day moving average for NFLX crossed bullishly above the 50-day moving average on September 08, 2025. This indicates that the trend has shifted higher and could be considered a buy signal. In of 14 past instances when the 10-day crossed above the 50-day, the stock continued to move higher over the following month. The odds of a continued upward trend are .
The Aroon Indicator entered an Uptrend today. In of 314 cases where NFLX Aroon's Indicator entered an Uptrend, the price rose further within the following month. The odds of a continued Uptrend are .
Bearish Trend Analysis
The Momentum Indicator moved below the 0 level on September 11, 2025. You may want to consider selling the stock, shorting the stock, or exploring put options on NFLX as a result. In of 78 cases where the Momentum Indicator fell below 0, the stock fell further within the subsequent month. The odds of a continued downward trend are .
The Moving Average Convergence Divergence Histogram (MACD) for NFLX turned negative on September 12, 2025. This could be a sign that the stock is set to turn lower in the coming weeks. Traders may want to sell the stock or buy put options. Tickeron's A.I.dvisor looked at 46 similar instances when the indicator turned negative. In of the 46 cases the stock turned lower in the days that followed. This puts the odds of success at .
NFLX moved below its 50-day moving average on September 11, 2025 date and that indicates a change from an upward trend to a downward trend.
Following a 3-day decline, the stock is projected to fall further. Considering past instances where NFLX declined for three days, the price rose further in of 62 cases within the following month. The odds of a continued downward trend are .
NFLX broke above its upper Bollinger Band on September 04, 2025. This could be a sign that the stock is set to drop as the stock moves back below the upper band and toward the middle band. You may want to consider selling the stock or exploring put options.
The Tickeron SMR rating for this company is (best 1 - 100 worst), indicating very strong sales and a profitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron PE Growth Rating for this company is (best 1 - 100 worst), pointing to outstanding earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron Profit vs. Risk Rating rating for this company is (best 1 - 100 worst), indicating well-balanced risk and returns. The average Profit vs. Risk Rating rating for the industry is 81, placing this stock slightly better than average.
The Tickeron Price Growth Rating for this company is (best 1 - 100 worst), indicating steady price growth. NFLX’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron Valuation Rating of (best 1 - 100 worst) indicates that the company is significantly overvalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (20.450) is normal, around the industry mean (25.356). P/E Ratio (51.151) is within average values for comparable stocks, (80.917). Projected Growth (PEG Ratio) (1.331) is also within normal values, averaging (5.150). Dividend Yield (0.000) settles around the average of (0.039) among similar stocks. P/S Ratio (12.579) is also within normal values, averaging (39.245).
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a provider of online movie rental subscription services
Industry MoviesEntertainment
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