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NFLX the day isn't over yet, could still see the 70's ;)
LNKD DD
I did some more dd on LNKD this weekend and expect them to miss on the bottom line this Thursday amc, and here is why.
First quarter earnings are going to be the weakest in a while and management said this in the last cc. They are making the most hires ever in a quarter which will be a large expense(the only reason they beat on the bottom line last quarter was because they only hired 200 last quarter instead of the 500 they projected), they had already hired over 200 at the cc in early feb and said they were on pace to make the most hires ever in a quarter. They also started aggressively increasing mobile advertising in the quarter which is another large expense and one which they haven't figured out how to monetize yet. And another unknown expense which wasn't discussed in the cc guidance was an acquisition they made in the first quarter without disclosing what they paid. Considering what some of these peripheral social media companies have been selling for, this could be another large expense and possibly some dilution.Based on their rev projections, it looks like this will also be the first time in 6 quartes that they don't increase revs yoy over 100%, growth is slowing.
Looks to me like the powers that be are running the stock up pre earnings so they can tank it after. Company is still doing well but seems way over valued to me and a bottom line miss could be the catalyst to take it down.
Disclosure- I am short, this could be a risky on going into earnings.
I wouldnt be surprised to see MSFT buy NOK after teaming up on all these new windows based phones.
Yep, if you're short NFLX
Nice trade!
NFLX down after hours because of this-
Uh oh...
Apple In Talks With Epix On Movie Streaming -Reuters
Last update: 4/27/2012 4:55:59 PM
DOW JONES NEWSWIRES
Apple Inc. (AAPL) is in talks to stream movies from the studios that own the Epix cable channel, Reuters reported Friday, citing people with knowledge of the situation.
The talks center on streaming through Apple's set-top box, as well as other upcoming devices, which would include a much-anticipated television set, according to Reuters.
Epix has an exclusive streaming agreement with Netflix Inc. (NFLX), but that is good through September, according to Reuters. Epix is owned by Lions Gate Entertainment Corp. (LGF), Viacom Inc.'s (VIA) Paramount Pictures and MGM.
Apple declined to comment on "speculation," according to Reuters, while an Epix representative had no comment.
Full story at http://www.reuters.com/article/2012/04/27/us-apple-epix-idUSBRE83Q18720120427?type=companyNews
LOL That's funny, but I just don't feel comfortable holding anything long in this market...I feel like they could pull the rug out anytime...I think going through the last crash has me really gunshy.
LNKD I'm sticking with it for now, and will likely hold through earnings...maybe this is the blow off top here?
Don't feel this stock should be over 100 yet and neither do all of the insiders selling. I'm also not convinced by this market move which is helping it. The stock was ready to break down on high volume early this week...I expect it to continue when the market slows down, we'll see...
I just don't see any reason for the markets to go up...
...just reported a major GDP miss and the market keeps going? I wouldn't be suprised to see new highs in the fall, but thought the market would take more of a breather before then...I still think it's possible...
LNKD 107.69 is being very mean to me here, looking ready to test all time high at 108.50...don't see much reason for it to head higher but making me nervous nonetheless...
Insiders are continuing to sell-http://www.nasdaq.com/symbol/lnkd/sec-filings
NFLX-I'm thinking this will be the last day it treads water in the 80's...looking for it to find a new base on Monday...looks really weak today again with the markets green.
Tanker NFLX...
...expecting it to open in the 70's on Monday ;)
NFLX I think it will see new lows today....but I'm wrong more than 50% of the time.
Good Morning piker...
...the market seems to be helping it, but still looking weak to me.
NFLX Bounce above 84 here...it's head breaching the water gasping for air... ;)
The buying just isn't there like it has been the last few days.
Yes, that's a big miss on GDP isn't it? Surprised to see futures still very green.
It will probably be closer to eventually:30
Yep, they are the new economy, very convenient for buying things you don't need to check out first...what will happen to the brick and mortar? How do you compete with companies with no storefront overhead? Will we get to the point where you can't hold anything before you buy it?
I agree that this is another bubble...eventually these stocks have to trade in line with other retailer valuations...the exorbitant premium for being an online retailer can't last.
AMZN- It sure is tempting...did you add to your short?
This market makes no sense...
...AMZN beat their sandbagged estimates, and profits were down year over year and the stock soars? Last week almost everybody beat and tanked...did AAPL change everything? AMZN is now trading at almost 100 times next years earnings estimates...crazy junk...
...good thing for our NFLX short in AMZN's report though, is that their earnings were down due to spending more on things like streaming video. NFLX is in what is quickly becoming a highly competitive, commoditized market...competing against some of the biggest companies in the world...Walmart, Apple, Amazon, Viacom...
Well, it looks like AMZN is the next AAPL for the markets.
NFLX Thanks...I see the Hulu news as bad for NFLX because it means one of their main competitors is growing.
NFLX spike was all the Hulu news...it was making new lows as the SPX was making new highs. Feels to me like institutions are unloading, and they back off to let it pop every now and then to try and bring in more bottom feeders to sell too...eventually the buying will dry up and this will make another big drop. With no significant growth on the horizon, and no earnings, this could be a 20-30 dollar stock.
NFLX It's from Bloomberg news just out say Hulu is valued at $2 billion, from trading on NFLX looks like just another spike to bring in buyers to sell to.
NFLX just jumped 2 bucks in 5 minutes, anybody know why?
Edit-I hear it's up because Bloomberg mentioned Hulu is valued at $2 billion. Sounds like a shortable spike.
I am underwater on my LNKD short currently, but do not expect it to hold these highs after their numbers on the 3rd...it appears to be fully valued for 3-5 years out, but the facebook similarity is huge.
I think the computers have completely broken the market...
....I get the feeling the powers that be can enter into their computers whatever they want the markets to do, and because they have unlimited funds, the computers can make it happen. Computers seem the only reason to me why the market went straight up this year.
Any more AAPL's reporting to keep this market propped up?
SPX couldn't hold over that 1392, APPL now making new LOD's...
...anything on the horizon that can make the market break through this resistance?
GDP tomorrow?
NFLX couldn't stay green...the selling is steady and strong.
We were a bit early to the party yesterday but I think we're still looking good.
More Smoke and Mirrors at Netflix
By Rocco Pendola 04/26/12 - 09:17 AM EDT
NEW YORK (TheStreet ) -- For around a year, Netflix (NFLX_) CEO Reed Hastings floated the notion of a "virtuous cycle" operating within his company's streaming business.
We get more customers, we get more money, we can afford more content, we get more customers. - Reed Hastings, June 2011
Of course, that blew up in his face last year when he unveiled Qwikster and angered subscribers with a poorly executed price increase. I was never really all that hard on Hastings and Netflix for last year's well-publicized errors. In fact, to this day, I consider them a strange positive for Netflix.
Since last April, I have been yowling about Netflix's broken and unsustainable business model. There was no question in my mind that costs would consume the company, regardless of subscriber growth. No matter how hard Netflix tries to sell it as such, digital content spend is a variable, not fixed cost, at least if Hastings wants to obtain the quantity and quality of content necessary to bring in new customers.
Although Netflix can budget a particular amount of money for content each year, the strategic reality on the ground clearly shows that content creators can effectively force the company to spend more to secure content that it would like to have. While financial discipline can be a good thing, every time Netflix refuses to spend, it runs the risk of a sub-par streaming offering, which will do anything but drive new subscribers.
That aside, the so-called "virtuous cycle" was doomed before it didn't really even get started. Subscriber growth at Netflix would have had to progress onward and upward, unabated, for years, if not forever, for the company to truly execute a virtuous cycle. Ask Time Warner's(TWX_) HBO, Sirius XM(SIRI_), DirecTV(DTV_) and DISH Network(DISH_), even when you actually offer premium content, it's next to impossible to penetrate the majority of a population's households. That's basically what Netflix needs to do at $8 a month.
When these apparent Qwikster and price increase "missteps" not only brought subscriber growth a premature halt, but threw it for a loop, Hastings, even if he did not know he was doing it, was able to divert attention away from his company's inherently bad business model. Don't worry about the fact that we have billions in off-balance sheet requirements, Starz dumped us because we do not charge enough and we're spending through our nose to expand internationally, this difficult period comes as the result of little more than temporary obstacles. You can always spin temporary obstacles away because humans, particular Americans, like to believe that a little of false humility and hard work can fix anything.
Now, as subscriber growth gets set to take another pause, Hastings throws out another vile of smoke and mirrors. This time he calls it "increased seasonality." First, let's look at what the company expects, as per its Q1 2012 Letter to Shareholders:
Netflix attributes this, at worst nearly stagnant and at best tepid, growth to what it is calling "increased seasonality." This fancy phrase should die a harder and faster death than the virtuous cycle. Check the final couple pages of the above-linked shareholder letter for an explanation of increased seasonality. I have read it 116 times and, while I get what they're trying to say, it makes little sense.
It's also a bit strange that the company is comparing 2010 to 2012, especially because they're only using hypothetical numbers. Is this just another way to program us into believing that 2011 was little more than a blunder-induced anomaly?
In my opinion, what Hastings had hailed as the "return" of subscriber growth at the end of 2011 and during the beginning 2012 was little more than the result of stepped-up advertising and marketing -- some free, some paid. Of course, Netflix spent lots of cash on brand repair. They're running ads all over television, radio and elsewhere.
It did not hurt that Amazon.com's (AMZN_) Kindle Fire hit the market in Q4 and lots of boys and girls had tablets sitting under their trees at Christmas. Along with controversy comes free publicity. Netflix was top of mind in America for a while. And while that certainly might have prompted some to shun the service, it introduced others to it. Toss these factors together and you have the makings of a somewhat artificial bounce.
Where Hastings uses increased seasonality to prepare Wall Street for soft subscriber numbers in Q2, I think we're witnessing something more than that. I do not expect subscriber growth to return at all. In fact, with Netflix no longer top of mind and with streaming content that's inferior to a whole host of alternatives, including cable and satellite, I expect Q3 and Q4 to trend just as poorly as Q2, if not worse.
Again, this is simply my take. Only time will tell. It just seems to me that Hastings and company sat around the boardroom searching for ways to explain away an impossible business model for yet another quarter
NFLX Sure closed strong, yikes!
Tanker NFLX
Sell off is picking up speed.
PCLN will likely not hold 700 if the market sells off, but like you said, better shorts out there.
I was watchin NFLX in the 85's looking to start a short, but was waiting for a bounce, but it didn't bounce, so chased a bit, but did get a good size position. I already have my buy to cover placed in the 75's...the way this is tanking, that could be tomorrow. Look at how many down days it had during their PR fiasco...this is getting quickly unloaded here...
PCLN Always blows away earnings like AAPL, I think they could do the same next week, so I'm steering clear of that until after earnings. LNKD is a much more attractive short...
...trading at a forward PE over 100, barely holding over 100/share with the market rocketing...looking for it to fill the gap at 92.65 before earnings on the 4th...may hold this one through earnings.
Woohoo, the world economy is contracting again, but APPL sold 35 million phones....buy buy buy! ;)