1 Stock to Buy, 1 Stock to Sell This Week: Netflix, Walgreens

• Retail sales, Fed speakers, Q3 earnings will be in focus this week.

• Netflix is a buy with upbeat profit and subscriber growth expected.

• Walgreens Boots Alliance is a sell with disappointing earnings, guidance on deck.

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U.S. stocks ended higher on Friday to cap off their fifth winning week in a row, as investors digested the first batch of third-quarter earnings and continued to assess the Federal Reserve’s rate plans for the months ahead.

For the week, the benchmark S&P 500 and the blue-chip Dow Jones Industrial Average climbed 1.1% and 1.2%, respectively. Both averages hit fresh all-time highs and closed at records. The tech-heavy Nasdaq Composite added 1.1%.

Source: Investing.com

The holiday-shortened week ahead - which will see the U.S. stock market closed on Monday in observance of Colombus Day - is expected to be another busy one as investors assess the outlook for the economy, interest rates and corporate earnings.

Most important on the economic calendar will be Thursday’s U.S. retail sales report for September, with economists estimating a headline increase of 0.3% after sales rose 0.1% during the prior month.

Source: Investing.com

That will be accompanied by a heavy slate of Fed speakers, with the likes of district governors Neel Kashkari, Christopher Waller, Mary Daly, and Adriana Kugler all set to make public appearances.

As of Sunday morning, investors see an 86% chance of the Fed cutting rates by 25 basis points at its November 7 policy meeting, and a 14% chance of no action, according to Investing.com’s Fed Monitor Tool.

Meanwhile, third-quarter earnings season shifts into high gear, with Netflix (NASDAQ:NFLX) leading the charge. Other high-profile companies reporting include Bank of America (NYSE:BAC), Citigroup (NYSE:C), Goldman Sachs (NYSE:GS), Morgan Stanley (NYSE:MS), American Express (NYSE:AXP), Johnson & Johnson (NYSE:JNJ), UnitedHealth (NYSE:UNH), Procter & Gamble (NYSE:PG), Walgreens Boots Alliance (NASDAQ:WBA), United Airlines (NASDAQ:UAL), ASML (AS:ASML), and Taiwan Semiconductor (NYSE:TSM).

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, October 14 - Friday, October 18.

Stock To Buy: Netflix

I foresee another strong performance for Netflix’s stock this week, as the streaming giant’s third quarter earnings report will easily beat estimates thanks to favorable consumer demand trends and an improving fundamental outlook.