Nankai Group - Netflix Surges Despite Earnings Miss.

Nankai Group - Netflix, the internet content streaming provider has reported Q1 earnings that missed Wall Street analysts estimate s by a considerable margin but the company’s stock soared in after-hours trade as investors celebrated subscriber addition numbers far better than projected.

The 38 cents per share number came in far lower than the 69 cents estimates because of foreign exchange losses associated with the strong US dollar. “Investors reacted positively to the subscriber growth narrative because it means that there is considerable and consistent demand for the company’s products,” said a “Nankai Group” analyst.

The company said that if not for the foreign exchange losses, EPS would have come in at 77 cents a share.

Netflix, whose originally-produced content includes award-winning political drama, “House of Cards” starring Oscar-winning actor, Kevin Spacey and black comedy, “Orange Is The New Black” grew international subscriptions by 2.6 million compared to consensus projections for 2.3 million. Domestically, the company expanded its subscriber base by 2.3 million against expectations of 1.8 million.

“On pure fundamentals, we think the stock is grossly overpriced at current levels,” said the Nankai Group analyst adding, “there is no way to justify a $537 price tag on one Netflix stock but against the backdrop of an equity market driven to bubble levels by unprecedented monetary policy, we wouldn’t be surprised to see a $600 handle on it before long.”