Netflix may be the best performing stock in the S&P 500 this year. It's market cap is now north of $140 million. But it's got $7.5-$8 billion of content expense in 2018 and it's tapping the debt market to help pay for it all.
With so much equity value, why take on more debt?
-- Company has about $2.6 billion in cash and says "Our debt levels are quite modest as a percentage of our enterprise value, and we believe the debt is lower cost of capital compared to equity."
-- IS the content spend sustainable. Last year, Amazon reportedly spent $4.5 billion on content and Hulu spent around $2.5 billion. It's an arms race. Why doesn't wall street seem worried?