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Netflix, Inc. (NFLX) Message Board

  • brasiljs brasiljs Jun 20, 2003 11:52 AM Flag

    NFLIX Interst

    Anybody know why/who/when the 1 broker has a strong sell rating on this? Seems bizarre other firms are upgrading to Strong Buy and so forth with this one lone wolf???

    I'm just started looking at this stock today. I love their business plan, but haven't looked closely at the stock.

    The only hole I see in their service offering
    is the risk in people just sharing their subscription with their roomates/next door neighbors/entire floor of their apartment buildings. Can't really think of a way of preventing that though.

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    • >The only hole I see in their service offering
      >is the risk in people just sharing their
      >subscription with their roomates/next door
      >neighbors/entire floor of their apartment
      >buildings. Can't really think of a way of
      >preventing that though.

      I don't see this as too big of a deal, really. As you said, there's no way to preventing it. Remember though, that it's in the customer's best interest to get discs back to NetFlix as quick as possible, so you can get your next disc. Keeping a disc out to loan to your friends, and fellow tenants means that's one less new disc that you can get to watch yourself!

      If it makes you feel any better, this is not strictly a NetFlix issue. The "risk" of sharing is present in ANY video rental business (I've done it myself). The only thing that mitigates it in B&M stores is the threat of a late-fee if the video is not back quickly enough. However, for 5-day rentals, one can loan it to to a LOT of people before it needs to be returned.

    • I simply do not understand the short interest here, but I'm thankful of it. It'll make for nice pops up in the future. This one's a keeper.

      Sure, it would've been nice to get into this issue at 6, but I see nothing but good things for this company going forward. This one has a business model that even Warren Buffet could understand - and one I'm sure he'd applaud.

      Buy it now. Put it away. It's a subscriber growth story, the same way that AOL was in the early days. Plus there's the possibility of international expansion, adding new services, and much more.

      You'll see a few splits of this issue in the coming years, and its market cap will easily exceed BBI's in short order because W Street will award it an outsized multiple once subscriber and earnings growth are maintained.

      Use the service yourself, and then go back to the corner mom-and-pop shops or to BBI. You'll instantly understand the attraction here.

    • We would hope they do share the DVD’s gives NFLX built in new customers. It’s called word of mouth and already our biggest advertiser. I just signed my father in law up last night using it.

    • There's a lot of short interest in the stock. Apparently some people think it's ultimately worth nothing.

      I don't see sharing as a problem. A disc shared is kept out longer, lowering discs out per month. BTW, we occasionally take a disc (or vice versa) when visiting a daughter. But then she & we are both members.

      • 1 Reply to tanstaafl46
      • Thanks good point. Do you see Walmart or Blockbuster as realistic threats. Although Netflix is leading in recognition now. I would expect most of their customers were gained through mailers/online advertising. For those mom and pops who don't use the internet as much they may be more willing/trusting to subscribe to their Walmart's service for a more false sense of security in online service. Maybe not, but as it becomes more popular among with competitors joining in, seems the draw to the walmart service or maybe a an amazon would generate more subscribers and the service is easily duplicated.

 
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