Founded in by brothers Tom and David Gardner, The Motley Fool helps millions of people attain financial freedom through our website, podcasts, books, newspaper column, radio show, and premium investing services. NFLX is all over the news right now. A blowout second-quarter report cemented the message from several bullish analyst reports.
NFLX : Summary for Netflix, Inc. - Yahoo Finance
Meanwhile, David Einhorn took a negative view on the stock and Carl Icahn liquidated his large and profitable Netflix position. These events send lots of mixed messages about Netflix as an investment. Should you buy Netflix stock at these prices, despite missing out on a double in just six months? Or is it best to stand back and let this risky stock run however far it may -- up or down?
You might not have the patience for that. You'll hate owning Netflix stock if The shorter your investing horizon, the less you'll enjoy sticking with Netflix. The same warning applies if you reach for the heartburn medication every time the Dow dips 10 points in an afternoon.
There's no denying that Netflix offers a bumpy ride, and that the short-term returns are far from guaranteed to be positive.
The stock may set a lot of all-time highs, but it crashes back down in a hurry quite often. The largest single-day drop? That disaster made fellow Fool Tim Beyers wonder whether Netflix CEO Reed Hastings was fit to lead the company, and Motley Fool CEO Tom Gardner found himself "leaning away from being a committed long-term holder" of this stock. Some of the drops come a little bit slower, but still quickly enough to drive a nervous investor distracted. The rest of the time, you're looking at dramatic swings -- sometimes up, sometimes down, but almost always wild.
If that's not your bag, then neither is Netflix. Don't invest money here that you might need to use on short notice.
Share prices may dip steeply at any time and don't always recover quickly. That's the nature of the investing game in general, only more so for a volatile ticker like Netflix.
Furthermore, Netflix isn't known for its rich earnings and massive cash flows. Right now, the company is investing every spare dollar into its ambitious overseas expansion program, which should see Netflix streaming services becoming available in pretty much every nation on Earth within the next two years. Only a few pennies per share are kept for the bottom line, and Netflix stock currently trades for more than times trailing earnings.
So if you're into traditional value metrics, that's a big red flag. Greenlight Capital investing guru David Einhorn falls into this campfor example.
There's no shame in backing down from a top stock if it doesn't fit your investment criteria -- even if those forex tutorial reviews turn out to be overly defensive. Netflix CEO Reed Hastings, not-too-subtly pushing the second season of BoJack Horseman in the Q2 earnings call. But you'll love holding Netflix shares if All that being said, there are many other investor profiles who would find Netflix irresistible right now.
This week's second-quarter spwr stock price today revealed strong subscriber growth.
Unless another total disaster in the Qwikster vein comes along, the company is on track to reach at least 60 million domestic subscribers by That's far ahead of the timetable several bullish analysts recently set for that benchmark. Abroad, Netflix still aims to offer its service worldwide by the end ofwith an asterisk next to the tricky but netflix stock pre market Chinese market. It's a big world out there, and the domestic market doesn't hold all the keys to Netflix's future.
For now, that ambitious expansion project adds plenty of costs to the quarterly tallies, but Hastings expects the red ink to turn black once the overseas rollout is finished. Bythere will likely be several hundred million Netflix subscribers overall and annual earnings in the billions of dollars. As the business expands and then shifts into advantages of binary options strategies for beginners mode, the share price should continue to climb as well.
Granted, investors are already netflix stock pre market plenty of this future promise into today's share price.
As I explained earlier, it won't be a smooth ride to the top. That volatile nature cuts both ways. Growth stocks often command large price premiums for their promised future gains, and Netflix stands firmly in that camp.
Opportunistic investors can wait for the next big drop before loading up on Netflix shares, as I did in when Tim and Tom worried about the company's future. That particular batch of shares is currently a ten-bagger in my portfolio, and my overall Netflix holdings are up sevenfold. But market timing is often futile, and there's nothing wrong with simply buying Netflix at the top, either.
The next big drop might be a long time coming and may not dip below the current level. You just never know. It's never too late to catch a true growth rocket, and that includes Netflix today. So whether you like to catch the momentum of a growth story or prefer to buy volatile stocks on big dips, Netflix can deliver. The key is to keep a long investment horizon and plenty of patience with occasional price drops in between. As long as you don't lock in those low prices by selling your shares, those speed bumps can be ignored.
Do keep an eye on the business for signs that Hastings is losing his vision and focus, of course -- that would be a real "sell" signal. Otherwise, Netflix is a fast-moving stock for the ages.
Anders Bylund owns shares of Netflix, but you already knew that. The Motley Fool recommends and owns shares of Netflix. Try any of our Foolish newsletter services free for 30 days.
We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. Anders Bylund is a Foolish Technology and Entertainment Specialist.
NFLX Stock Price - Netflix Inc. Stock Quote (U.S.: Nasdaq) - MarketWatch
Where the two markets intersect, you'll find his wheelhouse. He has been an official Fool since but a jester all his life. Contains six flavors not found in nature. Believes in coyotes and time as an abstract.
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