LOL You're patting yourself on the back for a post that is 7 months old? With a vague prediction? You were wrong for 80+ points and 7 months. You would have gone broke shorting this from Feb.
Before I reply, it's bad that their PE is still 33 even at 130. AGR® Score Audit Integrity Netflix Inc is currently rated as having Aggressive Accounting & Governance Risk (AGR®), receiving an AGR Score of 26 percentile among the approximately 8,000 companies in North America rated by Audit Integrity, indicating higher accounting and governance risk than -- of the other companies.
I don't think they're doing anything differently than other companies like this. Blockbuster I can remember had a hell of a time getting their late fees back, and never did, and they went bankrupt but their brand is still out there. I have a Blockbuster DVD/Blu-Ray kiosk at a grocery store, and pretty much Red Box anywhere else, including CVS and Wal-Mart. Subscription revenue can always be booked forward. It's fine under GAAP, it's just considered what it is: aggressive. No, they were clearly overvalued. PE's above 50 should be a no-no for every investor. And if you don't like the 50 cutoff maybe you got some blockbuster stock try no PEG above 2. Any simple rule of thumb like that would have kept a lot of people from losing their shirt. Looks like a sell to me. Growth appears to be slowing.
I wasnt short or long, all I know is that if someone was short this stock and didnt go all in at once but rather short it in intervals every step of the way up they would have made quite a bit of money because stocks fall faster than they rise. So yes I am patting myself on the back for the prediction which I knew was coming, as you can see I did post it months and months ago. Like I said next up is PCLN! Give it time, it will be under $100 as well. Short it intervals though, do not go all in. When the collapse of PCLN takes place it will take only weeks to unfold!
I agree with the OP, there was no way, Netflix was making money with the original $8 subscription fee, when just the postage on 5 returns a month was about $4.... Then of course eventually they had to rise prices what resulted in a mass exodus. Now they are back pedaling and reorganizing the service. Losing the Starz catalog not helping matters either. So we shall see, but there had to be some creative accounting to show profits...
Listen: if anyone wants to go long this stock, just ask me to short sell it and it's guaranteed that the market sell-off will stop in its' tracks and the stock will pop $25 within 2 days. LOL I have never traded this stock but was considering going long via some calls and selling a ratio of higher OTM strike calls against. But it's hard to know where S/R is. Anyone have a thought ?
Looks like PCLN is already falling... Trading at $475! A drop of over $50.00 since I spoke about shorting it..... Going a lot lower, sub $200 levels by 2012 maybe even sooner!