Netflix (NASDAQ:NFLX) is heading into its Q1 2026 earnings release today with a strong tailwind, as shares have climbed ~43% from their mid-February lows, reflecting a shift in sentiment and renewed confidence in the streaming giant’s trajectory.
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A key turning point came in late February, when Netflix opted to walk away from its attempted acquisition of Warner Bros. Discovery, easing concerns about a large, potentially risky deal. The potential deal had a hefty price tag and would have forced Netflix to take on a significant debt burden. Investors were relieved to see it fade away, clearly preferring that the company focus on more organic growth pathways.
On that score, Netflix has been putting up solid results. The company delivered 16% revenue growth last year while steadily expanding profitability, with operating margins nearing the 30% mark. Looking ahead, management has guided for another solid year, calling for revenue growth in the 12% to 14% range alongside a further improvement in margins to about 31.5%.
Expectations for the first quarter reflect that steady backdrop. Wall Street is looking for revenue of $12.18 billion, representing about 16% year-over-year growth, while earnings per share are projected to reach $0.76, up 15% from the same period last year.
Heading into the report, investor Anthony Di Pizio argues the setup remains appealing, saying, “Netflix stock is trading at an attractive valuation, which could pave the way for significant upside over the next couple of years.”
Di Pizio argues that Netflix has been staying ahead of the competition, essentially “towering over” its main rivals in the streaming space. For instance, the investor cites Netflix’s 325 million subscribers at the end of 2025, more than HBO Max and Disney+ combined.
Netflix is padding its customer count by spending heavily on licensing and creating content, posits the investor, while its cheaper, ad-supported membership options are further driving its growing membership rolls.
When it comes to today’s print, Di Pizio expects the company to deliver a strong Q1. Hitting $12.2 billion in revenue would represent accelerating year-over-year growth, reflecting positive momentum.
“It might be a compelling buy today regardless of the upcoming earnings release,” Di Pizio summed up. (To watch Di Pizio’s track record, click here)
Wall Street is also feeling good about NFLX on the cusp of its earnings report. The stock boasts a Strong Buy consensus, backed by 30 Buy ratings against just 9 Holds. At the same time, expectations remain relatively measured, with the $116 average price target implying a modest ~7% upside from current levels. (See NFLX stock forecast)
Disclaimer: The opinions expressed in this article are solely those of the featured investor. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.