Tuesday, 18 July 2017

NFLX - bullish stranger stocks

Whilst the main market saw a day of moderate swings, there was powerful upside in Netflix (NFLX), which settled +13.5% at $183.60. Near term outlook offers a little chop - not least if sp'2435/25, but broadly, the $200s are clearly coming.

NFLX daily

NFLX monthly


Headline EPS did actually miss by 1 cent, but the market didn't care, as subscription growth was rather superb.

If you 'generously' extrapolate to an annual EPS of around $1.50, that still makes for a stock with a PE well >100. On any basis.. that is crazy, but then its a crazy market, where capital is desperate to find growth/yield.

With a new historic high today, many recognise the stock is headed far... far higher.

RBC capital are just one of many who are seeking >$200

It can be expected that we'll see further upgrades for 2018/19 to the 250/300 zone before year end.


Yours truly has ZERO interest in chasing such a 'FANG' stock - on a pure valuation basis. That sure doesn't mean I don't see great value in the company, and the original content is some of the best ever produced...

Season two of Stranger Things is one 'entertainment' reason to stay alive until at least Halloween 2017.