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Netflix stock soars on global prospects; IAC gains amid spinoff, M&A news

Shares in Netflix Inc. notched gains for the week ended Dec. 20 after the company offered a detailed look at its international operations that Wall Street analysts said eased concerns about the company's reliance on the mature U.S. market.

A Dec. 16 filing, which provided the company's most granular view of its international subscriber and revenue information to date, indicated strong growth in the streaming service's non-U.S. operations, offsetting slower growth in its domestic market.

Outside of the U.S., the company's second-largest region is Europe, the Middle East and Africa, which reported 47.4 million subscribers and $1.43 billion in revenue for the third quarter. Netflix's Asia-Pacific region, which has the fewest total members at 14.5 million, reported 53.1% year-over-year growth, the strongest of all regions.

"The more in-depth international disclosure gave us greater confidence in our overall forecasts," wrote Pivotal Research Group analyst Jeffrey Wlodarczak in a Dec. 19 report. The analyst increased his international subscriber forecasts and his price target on Netflix following the company's disclosure. Wlodarczak was one of several Wall Street analysts to update models on Netflix during the week.

Around midday Dec. 20, Netflix shares were trading up 12% from their Dec. 13 close, at $334.57 apiece.

In the internet software and services sector, IAC/InterActiveCorp's stock rose amid a pair of announcements relating to its stable of online brands and properties. The company on Dec. 19 formalized plans to spin off its Match Group Inc. online dating unit into an independent company and on Dec. 20 announced a deal to acquire Inc. in an all-cash deal that valued the family caretaking platform at $500 million.

Shares of IAC and Match Group were both up for the week as of about midday Dec. 20: IAC had gained about 7.5% to trade at $241.49, while Match was up 9.3% and trading at $78.60.

In the media and entertainment sector, shares of U.S. theater chain AMC Entertainment Holdings Inc. fell following the Dec. 16 announcement that Cineworld Group PLC, the parent company of AMC competitor Regal Entertainment Group, would buy Canadian theater group Cineplex Inc. and merge it with U.S. unit Regal to become the largest theatrical exhibitor in North America.

Shares of AMC were trading at $7.79 just after midday Dec. 20, down 5.3% for the week.

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