Netflix is gearing up for a potential breakout as its Q1 earnings loom.
Johnson & Johnson faces a likely stumble with a projected earnings dip in the spotlight.
U.S. stocks closed mostly lower on Friday, but the S&P 500 still managed to score its best week since November as traders kept an eye on the fragile two-week ceasefire between the U.S. and Iran.
Source: Investing.com
For the week, the benchmark S&P 500 jumped 3.6%, the 30-stock Dow Jones Industrial Average rose 3%, while the tech-heavy Nasdaq Composite rallied 4.7%, and the small-cap Russell 2000 gained 4%.
The coming week will once again revolve around developments in the Middle East and oil prices after weekend peace negotiations between the U.S. and ended with no deal. In response, President Donald Trump announced on Sunday that the U.S. Navy will begin blockading all ships from entering or leaving the Strait of Hormuz.
Besides geopolitics, reports on producer price inflation, existing home sales and initial jobless claims highlight a relatively light week ahead for U.S. economic data.
Source: Investing.com
Meanwhile, first-quarter earnings season kicks off with reports from major banks such as JPMorgan Chase, Bank of America, Citigroup, Wells Fargo, Goldman Sachs, and Morgan Stanley. Aside from banks, , , PepsiCo, Taiwan Semi, and ASML are also among the companies reporting their results next week.
Regardless of which direction the market goes, below I highlight one stock likely to be in demand and another which could see fresh downside. Remember though, my timeframe is just for the week ahead, Monday, April 13 – Friday, April 17.
Stock To Buy: Netflix
Netflix stands out as a solid pick for potential upside this week. The streaming giant is scheduled to report its first quarter financial results after the market close on Thursday, followed by a live video interview with management.
Market participants predict a sizable swing in NFLX stock after the print drops, according to the options market, with a possible implied move of +/-6.9% in either direction.
Source: Investing.com
Netflix is seen earning $0.79 per share, representing a 19.7% increase from the prior year. Meanwhile, revenue is forecast to jump 15.5% to $12.18 billion thanks to strong growth in its streaming business, aggressive price adjustments, and rapid expansion of its advertising tier.
The market’s mood on Netflix has shifted since it abandoned its bid for the streaming and studio assets of Warner Bros. Discovery, avoiding what would have been a massive, debt-heavy acquisition. The move preserved balance sheet flexibility and freed up capital for content investment, share repurchases, and further advertising momentum.
Looking ahead, recent news, such as the expansion of Netflix’s sports and gaming footprint, suggests new growth avenues are opening.
Source: Investing.com
After a steep sell-off earlier this year—driven largely by its abandoned bid for Warner Bros. Discovery’s streaming and studio assets—NFLX stock has rebounded as investors refocused on the company’s core strengths.
Shares are showing strong positive momentum after breaking out of a double bottom at $75.21, trading at $103.01 and riding a wave of positive price action into Q1 earnings. The MACD momentum remains bullish, and price action sits well above the 20- and 50-day moving averages, signaling trend strength.
Trade Setup:
Entry: ~$103
Exit Target: $110.00 (gain +6.8%)
Stop-Loss: $98.60 (risk -4.2%)
Stock to Sell: Johnson & Johnson
Johnson & Johnson, in contrast, is bracing for a more challenging earnings moment, making it a stock to avoid or sell this week. The company is slated to deliver its Q1 earnings before the opening bell on Tuesday at 6:20AM ET.
Analysts have grown increasingly cautious on JNJ ahead of the print, with half of the latest revisions being made to the downside. The options market is pricing in a potential +/-3.8% move for JNJ stock post-earnings.
Source: InvestingPro
Analysts anticipate a dip in Q1 earnings per share (consensus around $2.68, implying a low-single-digit decline year-over-year) alongside relatively steady-as-she-goes sales gains (projected in the $23.4–$23.6 billion range, driven by growth in Innovative Medicine and MedTech segments).
While the company’s diversified portfolio and strong pipeline (including drugs like Darzalex) provide long-term stability, the immediate outlook lacks meaningful catalysts for upside surprise.
Guidance and commentary are unlikely to change that near‑term picture dramatically amid product exclusivity losses (notably Stelara), and ongoing legal overhangs.
Source: Investing.com
Johnson & Johnson’s technical picture has soured. After hitting an all-time high of $251.71 in early March, the stock lost steam, closing below both the 20- and 50-day moving averages and flipping the SuperTrend indicator bearish.
With a rounding top pattern developing, JNJ may need to re-establish support before bulls regain confidence.
Trade Setup:
Entry: ~$238.40
Exit Target: $226.30 (gain +5.1%)
Stop-Loss: $247.20 (risk -3.7%)
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Disclosure: This is not financial advice. Always conduct your own research.
At the time of writing, I am long on the S&P 500, and the Nasdaq 100 via the , and the . I am also long on the . I regularly rebalance my portfolio of individual stocks and ETFs based on ongoing risk assessment of both the macroeconomic environment and companies’ financials.
The views discussed in this article are solely the opinion of the author and should not be taken as investment advice.
Follow Jesse Cohen on X/Twitter @JesseCohenInv for more stock market analysis and insight.
