Dear Valued Visitor,

We have noticed that you are using an ad blocker software.

Although advertisements on the web pages may degrade your experience, our business certainly depends on them and we can only keep providing you high-quality research based articles as long as we can display ads on our pages.

To view this article, you can disable your ad blocker and refresh this page or simply login.

We only allow registered users to use ad blockers. You can sign up for free by clicking here or you can login if you are already a member.

Why Did Netflix, Inc. (NFLX) Jump 6% on Monday?

I’m a longtime fan of Netflix, Inc. (NASDAQ:NFLX), both as a service and as a stock. In the long run, I expect Netflix shares to deliver multibagger returns, even from today’s rising buy-in prices. But sometimes the stock’s price jumps surprise me — Netflix, Inc. (NASDAQ:NFLX) gained more than 6% on Monday, and reasonable catalysts were nowhere in sight.

Netflix, Inc. (NASDAQ:NFLX)

The company wasn’t entirely devoid of news. Netflix, Inc. (NASDAQ:NFLX) just signed an exclusive multiyear deal with News Corp (NASDAQ:NWS) subsidiary 20th Century Fox Television, which brings hit comedy New Girl to U.S. customers with an unusually short delay. Season 1 is available today; upcoming seasons will run on Netflix, Inc. (NASDAQ:NFLX) as soon as the Fox run ends. Compare and contrast to the usual model, where Netflix has to wait until one year after the season finale.

The latest addition to Netflix’s American content catalog, starring Zooey Deschanel and Jake Johnson. But mostly Zooey Deschanel. Image source: Fox press materials.

New Girl is an award-winning audience favorite, and anything that brings more of ultimate MPDG Zooey Deschanel to my living room is a good thing. But this is hardly a game changer, worth a 6% overnight premium on Netflix shares. In particular, I’d be more impressed if this deal covered global rights, but Netflix, Inc. (NASDAQ:NFLX) customers in South America and Europe are out of the loop this time.

In other news, analyst house Morgan Stanley upgraded Pandora Media Inc (NYSE:P) to a buy. Why would that change Netflix shares in any way? Because Morgan Stanley explained its bullish view of Pandora Media Inc (NYSE:P) by comparing it to Netflix in a very flattering light.

“We believe Pandora is establishing itself as the ‘Netflix, Inc. (NASDAQ:NFLX) of Radio,'” said analyst Scott Devitt. That means being “a truly disruptive form of content consumption that offers investors the best pureplay exposure to the secular shift of broadcast radio dollars to online channels.”

Kind words indeed. Pandora Media Inc (NYSE:P) shares jumped as much as 10.2% on this upgrade. I suppose you could connect the dots and land at the conclusion that Morgan Stanley obviously loves Netflix just as much. Devitt’s view of Netflix is due for an update, being unchanged since setting a $200 price target back in February.

DOWNLOAD FREE REPORT: Warren Buffett's Best Stock Picks

Let Warren Buffett, George Soros, Steve Cohen, and Daniel Loeb WORK FOR YOU.

If you want to beat the low cost index funds by 19 percentage points per year, look no further than our monthly newsletter.In this free report you can find an in-depth analysis of the performance of Warren Buffett's entire historical stock picks. We uncovered Warren Buffett's Best Stock Picks and a way to for Buffett to improve his returns by more than 4 percentage points per year.

Bonus Biotech Stock Pick: You can also find a detailed bonus biotech stock pick that we expect to return more than 50% within 12 months.
Subscribe me to Insider Monkey's Free Daily Newsletter
This is a FREE report from Insider Monkey. Credit Card is NOT required.