plunged 5.6% ($20.07) to close at $339.50 on Jan 7, 2014, as
concerns over its subscriber growth resurfaced. Netflix is
expected to face significant competition from the likes of HBO
Go, Hulu and
Prime service, which is expected to hurt its subscriber base in
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Apart from these services,
YouTube is also expected to become a contender due to the
increasing investment on original content, which has been a major
growth factor for Netflix over the past 12 months.
In order to boost customer engagement, Netflix continues to
expand its original series portfolio. In Dec 2013, the company
announced that it will stream Mitt, directed by Greg Whiteley
from Jan 24, only a week after the documentary premieres at the
2014 Sundance Film Festival on Jan 17.
Netflix's partnerships with major film studios and production
houses will help it to stream original shows such as Sense 8
(some time in 2014) and Narcos over the next 12 months. The
company is also expected to stream the drama series Marco Polo,
produced by TWC.
Moreover, Netflix's partnership deal with
Marvel Entertainment will bring at least four new 13-episode
series and a mini-series based on characters such as Daredevil,
Jessica Jones, Iron Fist and Luke Cage on Netflix, beginning
Although international expansion is expected to be a major growth
factor, continuous subscriber loss in its DVD business and higher
spending on content acquisition are significant near-term
Netflix has reported an average surprise of 77.1% over the last
four quarters. The Zacks Consensus Estimate for 2013 and 2014
have remained steady at $1.74 and $4.20 per share, respectively,
over the last 30 days, with no major estimate
Currently, Netflix has a Zacks Rank #1 (Strong Buy).