Netflix (NFLX) ad tier subscriptions reach 23 million monthly active users. Also in the streaming scene, Redburn Atlantic analysts downgraded Paramount Global (PARA) stock to a “sell” rating, while also downgrading Warner Bros. Television. Discovery (WBD) to “Neutral”
Shares of Canadian fashion brand Aritzia (ATZAF) rose after it beat sales expectations and received an upgrade from CIBC.
Yahoo Finance anchors Julie Hyman and Josh Lipton analyze the movement surrounding these stocks while monitoring the performance of spot bitcoin ETFs that began trading Thursday.
For more expert insights and the latest market action, click here to watch this full episode of Yahoo Finance Live.
Editor’s Note: This article was written by Luke Carberry Maughan.
Video version
Josh Lipton: Pointers, we’ll start here with Netflix today. let’s see. Those stocks are up today. Well, 3% after the company said it had surpassed 23 million monthly active users globally for its ad-based plan.
So that was the title, Julie. This is according to comments made by the head of the company’s advertising department while speaking at CES. She also emphasized not only the numbers, but it was interesting that she highlighted engagement, which we know is often music to any marketer’s ears.
Among Netflix customers on ad-supported plans, more than 85% stream on the platform for two or more hours per month. To put these numbers in context, remember about two months ago Netflix said its ad-supported tier had about 15 million monthly active users.
Julie Heyman: I mean, two hours.
Josh Lipton: Very suitable for pop music–
Julie Heyman: Two hours or more a month, that’s not a lot – I mean, that’s a low bar.
Josh Lipton: Yes, two hours or more per month.
Julie Heyman: right?
Josh Lipton: I don’t know how that stacks up to others. I’m not sure.
Julie Heyman: I mean, how much Netflix do you watch in a month?
Josh Lipton: Well, listen, I have a four-year-old who loves–
Julie Heyman: Disney+, how much–
Josh Lipton: Yes, so I don’t know.
Julie Heyman: How much is Disney+–
Josh Lipton: I don’t know. It’s a fair point. I don’t know how this applies to others. I’m not sure.
Julie Heyman: This amazes me, this particular procedure. Meanwhile, on the back of these numbers, Citi came out on a note today that adoption is now accelerating, and Citi remains neutral on Netflix, we should point that out. They have a target price of $500, but this update definitely caught their attention as well.
I wanted to mention that we’re not just getting this news on Netflix, we’re watching the media industry more broadly here today. That’s because Redburn Atlantic has already downgraded Paramount Global to sell and Warner Brothers Discovery to neutral and said linear advertising is at a negative turning point, which is not what you want to hear if you’re relying on linear advertising.
Josh Lipton: Yeah, that was — the problem is that it’s just kind of a negative point. I mean, I think his point was for his clients was that he thought it applied to both names, but Paramount more, so that’s why he went in that direction with that.
Julie Heyman: right. And then, of course, we still have what happens with Paramount or National Amusements, Paramount’s parent company. The New York Post reported today that Shari Redstone will now conduct a formal auction process not for Paramount, but for National Amusements, its parent company. So the M&A speculation game continues.
Josh Lipton: Totally Correct.
Julie Heyman: Yes. Well, let’s talk about Aritzia too. This is a Canadian clothing chain. Shares rose more than 20% in today’s trading. The company reported third-quarter earnings sales that beat expectations, prompting an upgrade by at least one analyst. CIBC raised its rating on Aritzia stock to outperform, while also raising its price target on the stock.
I have to admit, this is something that caught my attention, because it’s not a topic we talk about often. But it was popular on our bar page today, so that’s the first reason. The second reason is that I know a lot of people who shop at Aritzia. It has actually expanded its presence in the US in the past few years.
And I was trying to explain to you, Josh, Aritzia’s position in the world of women’s apparel retail. And I said it’s like fast fashion, but on a banana republic budget. Like it’s fast fashion that kind of follows these trends, but it’s more expensive than Zara or H&M. It’s at a much higher price than those different chains.
Josh Lipton: Yes, they might like the patterns, but the stock was tough. I mean it’s lost about half its value in 2023 and it’s still very low over the last 12 months. Although we should mention that there is a lot of love on the street for this guy.
Julie Heyman: Well, I guess after he’s fallen so hard, maybe they’ll go back to…
Josh Lipton: That could be part of it.
Julie Heyman: – And they say okay, we like it.
Josh Lipton: This and its pricing.
Julie Heyman: We saw — we saw this upgrade from CIBC today. It looks like Raymond James also upgraded the stock today as well and said, there are still concerns, folks at Raymond James. There are still concerns about inventory gross margins. And we had a mild fall and winter, so people weren’t as eager to buy to go out and replenish their winter jackets, for example. But Aritzia attacks these issues.
Josh Lipton: New styles appear to be coming in the spring.
Julie Heyman: Yes.
Josh Lipton: So if you know people who are interested in this name, get ready.
Julie Heyman: Good.
Josh Lipton: Well, moving forward, investors’ appetite for cryptocurrencies was tested today as the first Bitcoin ETFs began trading following SEC approval. BlackRock’s ETF was the most heavily traded ETF of the day with more than $761 million worth of shares changing hands, according to Bloomberg.
Julie Heyman: Yeah, so let’s talk about some of these others that we’ve been monitoring throughout the day, shall we? So we should mention the caveat when we look at all the various spot Bitcoin ETFs and there’s obviously a bunch of them trading today. By the way, the thing that didn’t start trading like the spot Bitcoin ETF we talked about is Hashdex. Remember, we spoke with Samir Kerbaj, Chief Investment Officer, a few days ago. This fund has not yet been converted from a futures ETF to a spot ETF.
The rest of them are already trading. And when you look at the trading prices on our platform, they are trading except for the grayscale, which was there before. It’s the first trade so far.
This is the price, and this is the percentage change that we’re looking for on this one. They all also track the price of Bitcoin in different ways. So some of them – like grayscale, for example, are a thousandth of the price of Bitcoin, but others are priced differently.
Josh Lipton: Yes, I’m very interested from here what the competition is like in this space.
Julie Heyman: Yes.
Josh Lipton: There are a lot of big names. I’m interested to see how it works. I’m curious about how ETF issuers try to differentiate themselves, and how they market themselves.
Julie Heyman: Yes.
Josh Lipton: What do they think their competitive advantage is? I thought it was very interesting that Cathie Wood told you what kind of story she was telling.
Julie Heyman: Yes.
Josh Lipton: And then how — the price of Bitcoin from here and how do these new products and vehicles in any way impact that.