Its very easy to jump on the "NetFlix sucks" bandwagon. Sure the CEO made a serious blunder splitting the digital and hard copy business, while also raising prices. Sure they made the mistake of buying back stock at the top, only to issue stock near the low to finance operations. And yes, it seems every day there is new competition to NetFlix(NFLX). But here is what folks should be asking themselves: "Who is truly their competition?"
Is it the fellow streaming services that are popping up everyday like Amazonand their 'Prime' offering, which just became available on the Playstation 3? Maybe it's the cable companies and satellite providers? Maybe the Kiosks like Redbox, or the DVD to digital service Walmart just started?
Do people cancel the subscription to Netflix(NFLX) because of any of the services listed above? I actually think NetFlix(NFLX) is a complimentary service. I have most of the services above, and never think to cancel my Netflix(NFLX) subscription. If i want to watch a movie i check Netflix(NFLX) first, then check Amazon, and then may buy it on Itunes if those services dont have it. The $7.99 per month price tag is something I hardly notice on my credit card statement. Maybe I am wrong, but I think NetFlix is still a growth story, and I think Monday's earnings will reflect that.
NetFlix is currently trading at $104 as I write this, and think she gets some legs this week as folks start to get ahead of the earnings announcement next week. We currently hold the April $110 calls purchased at .29.
3 thoughts on “NetFlix (NFLX) : Bears are wrong…”
NFLX +4% awesome
aint seen nuttin yet ~~