Shares of Netflix, Inc.(NASDAQ:NFLX) pared its early losses and were recently trading lower by 1.55% to $78 after falling 6% in the morning session. Yesterday, the stock closed higher by 14% on new stake news.
This morning, analyst at Oppenheimer downgraded the stock to Perform is tipping sentiment with analysts pointing out Amazon's future behavior in Netflix's space is unknown.
Netflix shares rose by 14 percent, to stand at $79.24, following the decision of Carl Icahn, who is an investor. Icahn stated that the company is ripe for buying shares, and that the shares of the company are undervalued. In an SEC filing, the investor disclosed his acquisition of 9.8 percent of the company’s shares, and he says that this is a decision prompted by how ripe the company is, for taking, right now. In the SEC filing, which is a 13D filing he stated how the company actually has a large scope to grow, especially on an international base. He also stated that the company now stands at a very strong position in terms of the market value, and that the stocks should be bought, to reap the benefits of where the company is going, currently.
With the advent of growing dependency on technology, especially mobile technology, and with the widespread use of the internet all over the world, the company stands at a very advantageous position, and that it is a very valuable asset for the bigger companies, who face more direct competition with other such internet-based big-wigs. Although Icahn has been looking for ways to increase the shareholder value for Netflix, he has been unable to come up with a particular theory. Although he did express his desire to talk to the company heads in the future. There had been rumors about Microsoft considering bidding on the company. This news came hand in hand with the fact that Reed Hastings gave up on getting re-elected to the board. The rumors about Microsoft, however, were soon dispelled.
Rumors have been making the rounds about Amazon trying to make a bid as well. Amazon.com, however, would have to assess sales tax in many states, depending on the distribution of the Netflix DVDs. Despite Amazon starting to follow the assessment of the sales tax, however, the issue of bidding on Netflix is still just a rumor at present.
Microsoft could have bid for Netflix, as could have Google. But currently, no such news has materialized out of the rumors.