Netflix shares up 48% in past

Financial Mirror (Cyprus) - - FRONT PAGE -

De­spite a re­cent sell-off due to an­a­lyst con­cerns, shares of Netflix Inc. (NAS­DAQ: NFLX) have risen 48% in the past year, com­pared to a 4% dip in the S&P 500. Over the pe­riod, Netflix has added over $10 bln in mar­ket cap. The pri­mary rea­son is that Netflix still rules the pre­mium con­tent stream­ing busi­ness, de­spite plenty of com­pe­ti­tion. Granted, Ama­ Inc. (NAS­DAQ: AMZN) and Ap­ple Inc. (NAS­DAQ: AAPL) have prod­ucts to chal­lenge those of Netflix, as do ca­ble, fiber to the home and satel­lite TV providers. That has not stopped the com­pany’s rev­enue from ris­ing from $3.6 bln in 2012 to $6.8 bln last year. Over the same pe­riod, net in­come rose from $17 mln to $123 mln.

Morn­ingstar an­a­lyst Neil Macker wrote: “Al­ready the largest provider in the U.S., Netflix is ex­pand­ing rapidly into mar­kets abroad. The firm has used its scale to con­struct a mas­sive data set that tracks ev­ery cus­tomer in­ter­ac­tion. It then lever­ages this cus­tomer data to bet­ter pur­chase con­tent and pro­duce orig­i­nal ma­te­rial such as “Or­ange Is the New Black”. We be­lieve that this data and abil­ity to lev­er­age will help Netflix to re­main the largest provider in the U.S. and en­joy suc­cess in many of its newer mar­kets.”

That nicely sums up the con­sen­sus that has driven Netflix shares so much higher.

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