- Netflix is the best performing FAANG stock of 2018 so far, but that same outperformance is fueling skepticism.
- Shares of the streaming company fell 2% Monday, with short-seller Andrew Left's Citron Research saying the stock could slump to $300.
- You can track the stock's price in real-time here>>
Shares of Netflix slumped more than 3% Monday morning, as low as $318.79, after short-seller Citron Research said the stock could sink to $300.
"Stranger Things happening at $NFLX," noted short seller Andrew Left's Citron Research tweeted Monday morning. "With market cap up $17 billion in a week and short interest at 10-year-low, Citron thinks the stock can be shorted back to $300."
Left doubled down on his thesis in an interview with CNBC just hours after the tweet, saying that anyone could step up to compete with Netflix — it was just a matter of investing in their own content.
"There are competitors with deep pockets who are going to hire the same producers and create compelling content. Because of that, they do not have a moat like an Amazon. They do not have a moat like a Google," he said.
Netflix has gained an index-beating 60% since the beginning of 2018 as the company hawks plans to spend as much as $8 billion this year on 700 new shows. The stock is also beating its peers in the FAANG basket of Facebook, Amazon, Apple and Alphabet by a wide margin.
Wall Street seems to have lost some of its enthusiasm for Netflix as it outpaces the market at large, too. Analysts surveyed by Bloomberg have an average price target of just $273 for the stock — 15% below its opening price Monday.
"This is nuts, when does Netflix crash?" Financial Times editor Dan McCrum asked in a column Monday, citing junk-rated debt and burning cash to the tune of $0.5 billion per year.
The company is certainly spending like crazy. Most recently it announced a deal with "Glee" and "American Horror Story" producer Ryan Murphy to the tune of $300 million. It's a move that could help it continue to carve a global content "moat," but also one that is clearly fueling the debate.
Still, the company continues to top expectations, beating Wall Street's forecasted subscriber growth on its last earnings report in January.
- Police say wave of package explosions in Austin, Texas, could be linked
- TOM BRADY: How the greatest quarterback of all time makes and spends his millions
- Only 33 movies have ever hit $1 billion at the box office — here they are