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Netflix (NFLX) Appoints Scott Stuber to Head Movie Business

Zacks Equity Research

Netflix, Inc. NFLX is set to execute an aggressive marketing plan. Reportedly, the company has hired Scott Stuber, the famous Hollywood producer and ex-Universal executive, to spearhead its movie business. Netflix plans to release 30 original films in 2017.

Media reports further add that Netflix continues to rue the fact that only 33% of the total viewing comprises movies, despite taking measures. So to improve upon that number, Netflix is releasing new movies on its platform. The hiring of Stuber should provide impetus to Netflix’s movie business. Stuber has produced movies like The Breakup, Ted, Ted 2 and Battleship in a career spanning over two decades.

The streaming giant also recently brought rights for Will Smith starrer Bright, a thriller for $90 million. It had earlier purchased rights for the release of Brad Pitt’s War Machine for $60 million. The movie will be released in May this year.

According to a statement by the head of Netflix “Scott is well known and respected in the film industry. His innovative work and strong talent relationships should help accelerate the Netflix original film initiative as we enter into a new phase of big global productions with some of the greatest directors, actors and writers in the film business.”

We note that Netflix has outperformed the Zacks Broadcasting-Radio/TV industry in the last one year. While the stock gained 45.2%, the industry returned 16.7%. The upside can be attributed to a continuous increase in subscribers driven by expanding original content product portfolio.

Netflix, Inc. Price

Netflix, Inc. Price | Netflix, Inc. Quote

We also note that the company’s focus on international expansion is driving its top-line growth and providing a competitive edge against the likes of Amazon AMZN Prime. In the latest quarter, Netflix added 5.12 million of new international subscribers and anticipates adding another 3.70 million in first-quarter 2017

Currently Netflix carries a Zacks Rank #3 (Hold).

Stocks to Consider

Two better-ranked stocks in the broader technology space include ITV Plc ITVPY and Grupo Televisa TV. Both have a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.

Long-term earnings growth rate for ITV and Grupo are projected at 3.5% and 17.1%, respectively.

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Amazon.com, Inc. (AMZN): Free Stock Analysis Report
Netflix, Inc. (NFLX): Free Stock Analysis Report
Grupo Televisa S.A. (TV): Free Stock Analysis Report
ITV PLC. (ITVPY): Free Stock Analysis Report
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