Today's big news stories on Netflix Inc (NASDAQ:NFLX), Amazon.com Inc (NASDAQ:AMZN) and Apple Inc (NASDAQ:AAPL) could affect their stock prices.
It's another exciting day in the world of tech, with lots of major news emerging in the space. Netflix Inc (NASDAQ:NFLX) is poised to lose the rights to stream upcoming releases from Walt Disney Co (NYSE:DIS), as the latter plans to start its own direct to consumer streaming service. Amazon.com Inc (NASDAQ:AMZN) has a new price target that implied a near 30% upside, and the U.S. International Trade Commission is investigating Qualcomm’s allegations that Apple Inc (NASDAQ:AAPL) is violating its patents. The rumor has it that Apple may be looking to settle with Qualcomm Inc (NASDAQ:QCOM). With that, let's dive into details.
Disney Plans To Pull The Plug On Netflix Inc (NASDAQ:NFLX).
Disney announced that it would be pulling the plug on Netflix starting with its new releases in 2019. The former now plans to start its own direct to consumer streaming service and claims it will spend less than Netflix's $6 billion on content crafted specifically for this service. Disney hasn't indicated pricing for the service, since the launch is still a long way out. Netflix currently runs several original series owned by Disney, based on Marvel characters, including Daredevil, Jessica Jones and Luke Cage. The movies that are expected to be removed from Netflix include Disney as well as Pixar titles. According to Netflix, Disney movies will be available throughout 2018, and Marvel TV shows will continue to be available. However, this could still be a big blow to Netflix. Here's what Eric Reed of The Street has to say on the topic, "Netflix has no chill. It has lost almost half its content over the past three years. Why, exactly, do we all subscribe to it again, especially with offerings snatched away?" Unfortunately for Netflix, that question could soon turn into why investors are paying so much for Netflix stock. Netflix shares are down by over 3% in after hours trade. So watch that counter closely if you own or plan to buy shares of Netflix.
Amazon.com Inc (NASDAQ:AMZN) Stock Price Targets Hit A New High.
Amazon's stock price may have retraced from its recent highs. However, the stock's price targets seem to only go higher. The most recent endorsement comes from Rob Sanderson at MKM Partners, who boosted his target to $1,275 a share. That is now the highest price target for Amazon stock among prominent analysts, with two other analysts reportedly tied at $1250 per share. These numbers reflect the sentiment among 43 analysts surveyed by FactSet. Sanderson's price target now represents a near 30% upside from yesterday's closing price. The analyst believes that "revenue growth and share gain will matter more than profitability", while citing "the track record of management, consistency of share gain and massive untapped opportunity in retail and cloud computing services" as some of the key drivers for the stock going forward.
We ourselves like the narrative Amazon has created. Armed with ways to leverage, monetize and profit from its e-commerce dominance, such as its lending business and advertising business, Amazon has multi-billion Dollar profit opportunities ahead. Fuelled by this growth, we think there's a good possibility Amazon could hit the $1 trillion market cap by 2020, and possibly be the first to get there as well.
Apple Inc (NASDAQ:AAPL) Being Investigated On Qualcomm Allegations.
The U.S. International Trade Commission is investigating Qualcomm’s allegations that Apple is violating its patents related to mobile technologies deployed in iPhones. Qualcomm is hoping to effect a ban on imports of the specific iPhone models that allegedly infringe on its Intellectual Property. Not long ago, Apple sued Qualcomm for $1 billion, claiming that the latter was wrongfully collecting royalties on patents that didn't belong to the company. In April 2017, Apple said it would stop releasing royalty payments, since it was taking legal action against Qualcomm. However, Qualcomm hasn't taken this lying down. Last month, Qualcomm filed a lawsuit against Apple, for allegedly infringing on six patents that helped improve battery life on some iPhone models. As it turns out, this could seemingly backfire for Apple. Credit Suisse believes that "Apple could digest a payment, and an ongoing rate of $5.90 per phone as could be acceptable to both parties.". The firm thinks the upfront payment could be as large as $8 billion. That's not going to be a big hole in Apple's deep pockets. However, nobody wants that much money going to no avail, not investors at least.
Yesterday, we also saw earnings announcements by Disney, Priceline, TripAdvisor and Plug, among others, and each of their stocks is down by a fair bit since the earnings release. We know a lot of you may be eager to know more. So, if you're looking for a quick look at key earnings announcements, you should check out our detailed earnings roundup. Looking for great tech stocks? Check out Amigobulls' top stock picks, which have beaten the NASDAQ by over 145%. If you're a technical trader, you should also check out our daily stock trading ideas section.