Netflix To Get A Big Boost From Coronavirus Spread
Due to the global economy taking a hit as a result of the new coronavirus outbreak, analysts believe that business formats like Netflix will benefit from social restrictions.
The COVID-19 disease was first identified in China back in December 2019 but quickly spread to different regions of the world. As of now, more than 86,000 people have caught the disease in 64 countries and at least 2,900 deaths have been recorded. While experts have concluded that the ground zero of the novel coronavirus was in Wuhan, China, there are currently several other hotspots from which the disease is rapidly spreading.
South Korea has reported 3,150 cases, with 17 deaths, while Italy recently announced a total number of 1,128 confirmed patients, with 29 deaths. Iran has currently identified and quarantined 593 people, with a high death toll of 43. Japan and France are also potential hotspots, as they’ve reported 241 and 100 cases respectively. Now, health officials warn that COVID-19 is also spreading through the United States, despite President Trump claiming that great measures are being taken to stop an outbreak.
Since there are no vaccines or effective treatment, health experts advise people to stay at home and avoid any unnecessary trips outside, especially in the hotspots that are currently struggling with the virus. Consequently, many industries and businesses have experienced a decline. Even movie revenue has taken a hit as a result of this outbreak, and Wall Street experienced its worst sell-off in nine years. Though according to some analysts, these social limitations might end up in favor of streaming platforms like Netflix.
In fact, BMO Capital Market analyst Dan Salmon recently concluded as much by noting:
“[Netflix] is an obvious beneficiary if consumers stay home due to coronavirus (COVID-19 virus) concerns, and this has been reflected in considerable stock price outperformance this week.”
Moody’s Investors Services analysts, meanwhile, suggested that if this contagion becomes more internationally widespread, more people will seek home entertainment from services such as Netflix, Disney+, HBO Max, etc.
The numbers add up, too, since Netflix shares bumped up by 0.8% this week, so the streaming juggernaut is sure to benefit from this outbreak if it continues to spread. But all things considered, let’s hope that it won’t come to that.
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