I'm selling NFLX at $250/sh.
- Thread starter ptrjon
- Start date
the thing that amazes me is that there is stil 30% short interest at this price. That means that 130% of the companies shares aren't selling yet at these prices... this is a recipe for further success.
Yesterday as I was watching a show on hulu, they bombarded me with 3 hulu plus ads and I'm thinking, "no way they're getting $8 a month from me". People just don't get how weak Netflix's competitors are. Hulu just isn't going to be a high revenue business.
The people have voted, and they choose netflix and redbox... and both have plenty of room to grow.
Yesterday as I was watching a show on hulu, they bombarded me with 3 hulu plus ads and I'm thinking, "no way they're getting $8 a month from me". People just don't get how weak Netflix's competitors are. Hulu just isn't going to be a high revenue business.
The people have voted, and they choose netflix and redbox... and both have plenty of room to grow.
You forgot Amazon, whose service is actually a better deal right now, and if their database gets built up, will be a huge competitor to Netflix.
Also Facebook is playing with the idea of streaming movies. Oh yes, have we mentioned the usage caps by AT&T?? There are just so many things that can go wrong with Netflix, and I don't even see how they make good money with all their costs.
I can get 6 movies a month (their return is fast), that is 6 x 80 cents, $4.8 just for shipping out of the $12 monthly fee. (they introduced streaming only options for a reason) Then throw in copyrights, CDs etc. and their profit is disappearing.
You mentioned Redbox, and if you don't stream movies, that is actually a better deal, because you get 10 movies for $12 and you don't have to wait for it in the mail.
So Netflix's possible problems are:
1. Increased competition from other online streamers.
2. Usage caps from ISPs.
3. Other cheap movie distributors, like Redbox.
4. Movie studios want a bigger share.
Also Facebook is playing with the idea of streaming movies. Oh yes, have we mentioned the usage caps by AT&T?? There are just so many things that can go wrong with Netflix, and I don't even see how they make good money with all their costs.
I can get 6 movies a month (their return is fast), that is 6 x 80 cents, $4.8 just for shipping out of the $12 monthly fee. (they introduced streaming only options for a reason) Then throw in copyrights, CDs etc. and their profit is disappearing.
You mentioned Redbox, and if you don't stream movies, that is actually a better deal, because you get 10 movies for $12 and you don't have to wait for it in the mail.
So Netflix's possible problems are:
1. Increased competition from other online streamers.
2. Usage caps from ISPs.
3. Other cheap movie distributors, like Redbox.
4. Movie studios want a bigger share.
Netflix is a good speculative long, if only because of 30% short interest. Those shorters are stuck since $100. GMCR is another good long.
Netflix is one of those businesses that represents the revolutionary change in the way we consume content. It's hard to predict if Netflix will maintain their market dominance but what's certain is that they and their direct competitors will drain revenues from traditional media retailers and TV networks.
The impact that the internet was predicted to have on our lifes during the height of the dot com boom is now starting to materialize. The difference between that period and right now is that some business models have proven to be highly profitable and even promote the formation of natural monopolies. Those businesses will continue on a high growth path in an otherwise stagnating economy.
The impact that the internet was predicted to have on our lifes during the height of the dot com boom is now starting to materialize. The difference between that period and right now is that some business models have proven to be highly profitable and even promote the formation of natural monopolies. Those businesses will continue on a high growth path in an otherwise stagnating economy.