Homepage / Technology / Netflix isn't doomed by one quarter unless people start questioning the long-term investor thesis
Best Alternatives of VPN Software New Step by Step Roadmap for Marijuana News Privately owned Internet Access Avast Review Powerful Deal Achievement Top Rated Free VPN Services Adaware Review – Is Adaware Review Right For You? Ideal Legit Snail mail Order Bride-to-be Sites To Decide On In 2023 & Feedback Thailänder Brides Pleasant Thai Mailbox Order Wedding brides To Marry Tes Powerful Interracial Marriages Exquisite Interracial Lovers How to begin a Successful Wife Search Getting married to a Russian Child The right way to Meet Delightful Ladies Around the World To recognize Know About Ukrainian Single Girls Dating The Different Types of Sugar Daddies The key benefits of Dating a Latina Top 5 International Dating Sites Russian Women Seeking Men Overseas Cookware Interracial Lovers and the Backlash Against All of them Getting the Marriage License and Wedding ceremony Done Correct How to pick the Best Web based Marriage Company Delightful Interracial Lovers Crucial Russian Females Dating Suggestions for Men Top five Romantic Honeymoon Destinations Just what Soulmate? Web based Relationships Suggestions Setting Expectations just for Online Sugar Daddy Arrangements Marital relationship License and Ceremony Why Are Latinas Heated? Getting Foreign Bride-to-be Tips on how to Propose — What’s the Best Way to Say “I Do”? Dating Etiquette — The Modern Rules of Seeing A Quick Guide to the Use of NLP in Chatbots How you can Have a cheerful Marriage The right way to Fix a Relationship With out Hurting Your companion How to Spice Up a lengthy Distance Relationship The main advantages of Online Dating What is the Best Female Race to Marry? Western european Women Stereotypes Why Asian Girls Like Bright white Guys How to Succeed in On the web Relationships Top 5 Online Connections Tips Top 5 Online Connections Tips Leading Countries With Best Foreign Brides Powerful Interracial Relationships Asian Wedding Icon Meanings Where to Find a Deliver Order Star of the wedding For what reason Asian Girls Like Light Guys Asian Brides Via the internet 5 Latina Wedding party Traditions Will possibly not Have Dreamed about When should you Stop Online dating Other People in Online Dating Latina Relationship Interaction Styles How to Find a Bride On line Good Interracial Relationships Oriental Wedding Practices Top five Online Relationships Tips The right way to Meet Overseas Woman and Create a Longer Distance Romantic relationship Where to Meet Latina Mail Buy Brides Where to get a Hot Asian Star of the event Precisely what is the Best Female Race to Marry? Mixte Marriage and Asian Ladies Mixte Marriage and Asian Ladies Mixte Marriage and Asian Ladies Handling Modern and Traditional Principles in Oriental Relationships Cookware Woman That Want to Marry Browse Online Dating Websites Reviews Ahead of You Subscribe What Country Offers the Best Wives? Singaporean Wedding Customs – Blending Tradition and Modernity Effective Interracial Partnerships Ways to Express Take pleasure in in a Long Distance Romantic relationship Marriage ceremony Tradition in Thailand Damaging Communication in Relationships The Best Place to Meet a very good Woman Amazon says this Prime Day was its biggest shopping event ever Kudlow says President Trump is 'so dissatisfied' with China trade talks that he is keeping the pressure on As stocks regain their footing, an ominous warning looms Goldman Sachs downgrades Clorox to sell, says valuation is 'unsustainably high' How Satya Nadella has spurred a tripling of Microsoft's stock price in just over four years Kudlow says economic growth could top 4% for 'a quarter or two,' more tax cuts could be coming The one chart that explains Netflix’s stunning comeback US housing starts plunge 12% in June to a nine-month low Aerospace titans Boeing and Airbus top $110 billion in orders at Farnborough Target uses Prime Day to its advantage, logging its 'biggest online shopping day' so far this year Billionaire Marc Lasry sees bitcoin reaching up to $40,000 as it becomes more mainstream and easier to trade These are the 10 US airports where you're most likely to be hacked Amazon shares slightly higher as investors await Prime Day results Wreck of Russian warship found, believed to hold gold worth $130 billion A bullish ‘phenomenon’ in bond market is weeks away from fading, top credit strategist says Stocks making the biggest moves premarket: MS, GOOGL, TXN, UAL, NFLX & more Twitter shares up 50% since late April means most upside priced in, analyst says in downgrade EU fines Google $5 billion over Android antitrust abuse Mortgage applications fall 2.5% as buyers struggle to find affordable homes America may not have the tools to counter the next financial crisis, warn Bernanke, Geithner and Paulson Investors are getting spooked as the risk of a no-deal Brexit rises EU expected to fine Google $5 billion over Android antitrust abuse Ex-FBI chief James Comey urges Americans to vote for Democrats in midterm elections Elon Musk apologizes to British cave diver following baseless 'pedo guy' claim Disney, Comcast and Fox: All you need to know about one of the biggest media battles ever Xiaomi shares notch new high after Hong Kong, mainland China stock exchanges reach agreement


Netflix isn't doomed by one quarter unless people start questioning the long-term investor thesis

The core theory of Netflix‘s wild run to a $175 billion valuation hasn’t been debunked with one quarter of slower growth than forecast.

But the Q2 miss might make some investors reconsider why they’re betting on Netflix in the first place.

The basic hypothesis for bulls is that Netflix is on its way massive global subscriber growth that will eat away at legacy media companies. As I wrote about here, analysts nearly universally expect Netflix subscribers to keep soaring — to 200 million and higher by 2020.

Nothing announced today undercuts that general idea. Netflix again announced significant growth, adding 5.2 million customers to 130 million global subscribers.

The problem was the company’s own internal prediction pegged that quarterly number at 6.2 million. Missing by 1 million customers is a lot, especially because Netflix has gained a reputation for beating its own estimates. Netflix also didn’t really offer a reason, other than blaming their own forecasting models. That’s why the stock is down about 14 percent in after-hours trading. Netflix, itself, called the quarterly results “not stellar” in its letter to shareholders.

If you thought Netflix would erode legacy media by outspending many of today’s players (Lionsgate, Viacom, AMC, etc.), spending $22.5 billion per year on content by 2022 like Goldman Sachs reportedly predicted, nothing announced today changes that thesis.

As Daniel Ives from GBH Insights wrote in a note to clients, “We believe this is a speed bump rather than the start of a negative sub trend for Netflix, as the streaming market and content arms race continues to be a major tailwind for the company over the next 12 to 18 months.” Ives has a target of $500 a share on the stock.

The problem is Netflix’s huge content spend is aided by its valuation. When you increase spending and your stock rises, that’s a sign to keep increasing spending.

When your stock starts moving the other direction over a sustained period of time, maybe you start pulling back on those gaudy spending predictions.

Nothing today yet suggests Netflix has changed its long-term focus — and CEO Reed Hastings’ attention to his company’s long-term focus is unwavering. He’s even posted it on the company’s website.

But maintaining a high valuation certainly helps accelerate the strategy. If the valuation starts to shrink, the entire thesis could come under question.

Source: Tech CNBC
Netflix isn't doomed by one quarter unless people start questioning the long-term investor thesis

Comments are closed.