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Thursday, December 2, 2010

Netflix (NASDAQ: NFLX) is Unstoppable

Netflix (NASDAQ: NFLX) continues to head higher with no limit in sight. The stock experienced a small correction today, falling just 2.8%, but has been up over 48% in the last 3 months. This small pullback may be partially attributable to CFO Barry McCarthy selling over $18 million worth of Netflix by exercising his options, weighing the stock down on a positive day for the index. However executives usually sell shares for many reasons, and it is not necessarily a tell that the stock is going lower. Only 9 of the 32 analysts that cover the stock have it on a sell. The majority of analyst believe in Netflix and that it can continue going higher - a positive sign for investors that track analyst ratings. Netflix currently trades with a 75 PE ratio. With Netflix growing much faster than incoming competitors such as Apple (NASDAQ: AAPL) and Amazon (NASDAQ: AMZN) who offer similar services, some bullish investors believe that Netflix' PE ratio can expand to much higher levels.

Netflix is up over 263% year to date and pulled back 2.8% to $200.14 in today's trading.

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