Poetic Portfolios

Today I’m wishing that I had paid attention to my own analysis. In December, I took a look at Netflix (NFLX) and noted that shares were expensive, and that I would look to buy below $50. Well, shares dipped below $50 earlier this month, and I found myself without any cash to invest. Then shares rocketed up almost 24% yesterday. (more…)

In a recent post, I calculated an intrinsic value for Netflix at $43 per share. This assumed 22% growth this year. In their third quarter, Netflix posted profits that were up 48% year-over-year on a revenue increase of 24%. Gross margins remained relatively constant, but net margins grew largely as a result of less marketing as a percentage of gross profit. (more…)

I really haven’t been following Netflix (NASD: NFLX) all that closely for the past year. A little over a year ago, I thought it looked like a bargain. I valued the shares conservatively at $33.75, and a bit more aggressively at $60 per share. After a year has passed, Netflix is outpacing my $60 per share growth scenario, yet remains valued at about $44 per share. So what are shares worth today?
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A little over a week ago, I wrote that Netflix (NASD: NFLX) shares were a bargain. Since then, Goldman Sachs Asset Management has indicated that their stake in Netflix rose from 3.12% to 5.4%, and Netflix announced the authorization of a $100 million stock buyback. Both announcements are positive signs for shareholders. Netflix’s stock has risen approximately $3.00 per share, or 13%, in the past week. (more…)

In my previous article, I concluded that Netflix (NASD: NFLX) will not demonstrate the type of growth that they have in the past. It is more likely that they will continue to grow at a steady pace, capturing at least a majority of any new rent-by-mail customers. One of the benefits of Netflix reaching a more mature stature as a company is improved cash flow or owner earnings. (more…)

Now that Netflix (NASD: NFLX) has reported their 2007 results and given their outlook for 2008, I thought it would be a good idea to take a look at this company’s past performance and their 2008 outlook. After doing this, I will try to calculate several probable values for Netflix in a separate article. (more…)

I have already posted my previous analysis of Netflix as of July 2007. I have to say that I did not expect negative subscriber growth in their fiscal second quarter. Netflix has since lowered their prices and produced some positive subscriber growth. Blockbuster has faded from this market by raising some of their prices for Total Access. Blockbuster has also reduced marketing of their rent by mail program.

Netflix has now successfully fended off competition from Amazon, Walmart, and Blockbuster. Yet more competitors continue to present themselves. Apple recently announced that they are pursuing a digital rental program. In addition, overall growth in the DVD rent by mail market has been pretty weak this year, growing only from 8.8 million subscribers at year end 2006 to 10.1 million subscribers at the end of the third quarter. Because of the endless competition and the slowing growth of the DVD rental market, Netflix may not present the returns I had originally hoped for when purchasing their stock three years ago. (more…)

The following post on Netflix (NASD: NFLX) was originally posted July 15, 2007 at odysseyroad.com.

I first bought Netflix (NASD: NFLX) in October 2003, and it has been quite a wild ride. The financials have only gone in one direction, that of constant improvement. The price of shares and the news reports, however, have been all over the place. I haven’t taken a close look at the company since January of this year, but since then their growth has been impacted greatly by Blockbuster’s (NYSE: BBI) Total Access program. As the second quarter results approach, it’s time for me to take a closer look at the company and its prospects. (more…)