Whenever the U.S. economy begins to show signs of a recession, investors begin the inevitable search for apocalypse stocks.
Even as the market teeters on the brink of collapse, there are always companies that seem poised to withstand the coming economic apocalypse, no matter how scary the world may seem. That’s often because consumers rush to stock up on certain items before conditions get even worse.
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Given the high uncertainty surrounding most facets of the U.S. economy right now, it’s not hard to see why panic is spreading quickly. Meanwhile, the stock market has struggled so much that even the classic apocalypse stocks, such as Campbell’s Soup Co. and Procter & Gamble, have struggled despite panic buying trends.
However, Wall Street analysts have placed a surprising new company in the category of companies that can thrive in difficult economic conditions, and it’s one that doesn’t sell essential products.
Right now, many tech stocks are struggling but one industry leader has emerged as a Q1 winner.
Image source: Costfoto/NurPhoto via Getty Images
The new apocalypse stock is here and isn’t what most people think
Some of the tech sector’s most prominent companies report earnings for the first quarter of 2025 this week, and investors are watching keenly. Given how poorly many of these stocks are performing, there are plenty of questions as to their leaders’ plans to turn things around in Q2.
But one high-growth tech company has already reported earnings and delighted investors with a sizeable beat on key metrics. Netflix (NFLX) saw revenue increase 13% in Q1, which it attributes to better-than-expected subscription and advertising results.
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While Netflix isn’t a member of the Magnificent 7, the group of tech stocks responsible for most of the sector’s growth, it is currently outperforming many of its members. This has prompted multiple Wall Street analysts to issue bullish takes on NFLX stock, while some experts speculate that it has the potential to reach a trillion-dollar market capitalization.
Both JPMorgan and Bank of America have issued positive takes on Netflix, framing it as a strong company that is well-positioned to ride out the current storm and potentially thrive in a troubled economy. Both Goldman Sachs and Piper Sandler have increased their price targets as well.
Maintaining a bullish price target for NFLX stock of $1,175, Bank of America analysts state that “The company remains very well positioned in the Media and Entertainment landscape with sustainable growth drivers that should prove to be predictable and defensive amid a wide range of macroeconomic scenarios.”
Reiterating an Outperform rating, Brian Pitz of BMO has increased his price target to $1,200, an increase of $25. He maintains a similar perspective, stating that “Entertainment typically remains resilient during uncertain macro.”
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Analysts at Wells Fargo have also highlighted the “uncertain macro” conditions but note that they believe Netflix has “substantially higher relative appeal,” increasing their price target to $1,222. And JPMorgan analysts, who maintain a $1,150 price target, describe Netflix as operating in a “stable operating environment w/no indications of macro impact.”
The future looks bright for Netflix but not for the US economy
When economic conditions appear particularly bleak, many consumers will scale back on luxuries. For years, that meant purging things such as subscriptions to expensive streaming services like Netflix.
The fact that Netflix has reported such positive results regarding its subscriptions, particularly as its prices have increased, indicates that its streaming services are no longer considered a luxury by many but are seen as a necessity, even as the streaming market becomes increasingly oversaturated.
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Wall Street veteran Stephen Guilfoyle recently provided further context on Netflix following its earnings beat and where it may go from here.
“The business is rocking. Execution is strong on the consumer end,” he states. “I think the meat and potatoes of what comprises the fundamentals could be better managed. The bottom line is that the guidance is outstanding, and Wall Street is largely impressed.”
Since the earnings beat, Netflix stock has performed extremely well, rising steadily while many other tech stocks have battled high volatility. While it may be surprising to see a high-growth tech company ranked among apocalypse stocks, Wall Street has made it clear that it sees Netflix as a stock to buy when consumer fears start to rise.
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