Netflix, When Growth Stops Growing


 “When the music’s over, turn out the lights” -Jim Morrison

The chart on $NFLX now says 50-60 bucks to me. Old guard growth like $MSFT, $INTC and $CSCO also stopped innovating and growing to a degree, but had the luxury of massive cash positions, so they became value plays. Multiples can only contract so much, so now they trade like utilities.

Netflix doesn’t have that same luxury and it will continue to get punished over time unless of course someone does see some value, for whatever reason, and makes a bid.

Janney is out this morning with a “sell” and a 50 target, $JPM is out with a “neutral” with a 67 target and $C is out with a “hold” and a 95 target.

I roll on floor laughing at the ineptitude of these analysts. Not because their initial call was just horrible to begin with, but because they didn’t have the balls to own up when they were wrong and advise you to cut the chord when there was still time to do so.  So when your Smith Barney broker tells you today that Citi is at a hold  and JPM is at a neutral, rest well. I’m sure he or she has your best interest at heart.

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