Cart (0)
VIDEOTicker Shock: Three Reasons Why Netflix Is a Must-See Stock
Friday's top stories and stocks with potential to move.
 |
|
Asian stocks were a mixed bag. The Heng Seng closed up a smidge while the Nikkei was off a little more than 1.5%. However, European stocks were in the green earlier this morning. And here in the US, we're currently trading higher.
Netflix (NFLX):
The movie-rental company’s first-quarter release seemed to be solid overall. On the plus side:
1. Excluding items, it turned in $0.40 - about a nickel north of expectations.
2. In the release, the following caught my eye:
“Netflix ended the first quarter of 2009 with approximately 10,310,000 total subscribers, representing 25% year-over-year growth from 8,243,000 total subscribers at the end of the first quarter of 2008 and 10% sequential growth from 9,390,000 subscribers at the end of the fourth quarter of 2008.”
3. Finally, in the release, its 2009 outlook caught my eye as well: “GAAP EPS of $1.56 to $1.72 per diluted share, up from $1.43 to $1.59 per diluted share.”
I think the company is most certainly a better pick than Blockbuster (BBI) at this point in time. However, I think it’s had a pretty nice run over the last couple of months, which makes me a bit nervous. To boot, at about 28.3 times the current-year estimate of $1.60, it’s a bit, shall we say, expensive.
Microsoft (MSFT):
Good ol’ Mister Softee was out with its third-quarter earnings after the bell last night. Ballmer and crew managed to put up $0.39, excluding items, which was in line with expectations. However, its revenue number didn’t exactly compute: It came in at about $13.65 billion, whereas analysts had been figuring on right around $14.1 billion. I also wasn’t too thrilled with a comment reportedly made by its CFO, Chris Liddell. More specifically, Reuters quoted Liddell as saying on a call: “While we would all like to think that our recovery will be soon and painless, we unfortunately believe that it will be slow and gradual."
Not the type of optimism I’d like to hear. Not to mention, I’d have liked some more color in the way of guidance going forward. But hey, as Homer Simpson might say, “Watcha gonna do?”
I continue to think this is a good longer-term play, but I’m not overly excited about hopping aboard right here. Sure, you’ve got the Windows 7 operating system, that folks are starting to talk about, but I’d like to see an even bigger potential catalyst. I’d like to see them make a move on Yahoo (YHOO) - that’d get my motor running.
Will it? I don’t know. But with Yahoo’s share price starting to show some signs of life, I think if they're planning on anything, they better kick it into high gear.
The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.
Copyright 2011 Minyanville Media, Inc. All Rights Reserved.
