Needham Slashes Estimates on Netflix (NFLX), Reiterates Underperform Rating
Tweet
Share
E-mailGet Alerts NFLX Hot Sheet
Price: $78.16 -0.1%
Rating Summary:
57 Buy, 26 Hold, 2 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
Rating Summary:
57 Buy, 26 Hold, 2 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
Join SI Premium – FREE
Needham & Company reiterated their Underperform rating on Netflix (NASDAQ: NFLX) Thursday and sharply lowered estimates.
The firm comments, "In its effort to drive subscriber growth, Netflix has spent what some would regard as recklessly to acquire streaming content. However, subscribers growth has not kept pace with the growth in content costs. As a result, the profitability of an average stream subscriber has fallen dramatically. Unless Netflix brings the growth in content costs into line with the growth in streaming subscribers, our analysis indicates the company’s domestic streaming business could soon become unprofitable."
Needham cuts 2011 EPS from $4.25 to $3.94 and 2012 from $2.50 to a loss of $0.50.
The comments follow yesterday's 11%+ surge in the stock on steaming data from the company and Yahoo! takeover rumors.
For an analyst ratings summary and ratings history on Netflix click here. For more ratings news on Netflix click here.
Shares of Netflix closed at $80.45 yesterday.
The firm comments, "In its effort to drive subscriber growth, Netflix has spent what some would regard as recklessly to acquire streaming content. However, subscribers growth has not kept pace with the growth in content costs. As a result, the profitability of an average stream subscriber has fallen dramatically. Unless Netflix brings the growth in content costs into line with the growth in streaming subscribers, our analysis indicates the company’s domestic streaming business could soon become unprofitable."
Needham cuts 2011 EPS from $4.25 to $3.94 and 2012 from $2.50 to a loss of $0.50.
The comments follow yesterday's 11%+ surge in the stock on steaming data from the company and Yahoo! takeover rumors.
For an analyst ratings summary and ratings history on Netflix click here. For more ratings news on Netflix click here.
Shares of Netflix closed at $80.45 yesterday.
Serious News for Serious Traders! Try StreetInsider.com Premium Free!
You May Also Be Interested In
- Coherent (COHR) PT Raised to $420 at Needham
- Alpha & Omega Semiconductor (AOSL) PT Lowered to $45 at Needham
- Wolverine World Wide (WWW) PT Raised to $24 at Needham
Create E-mail Alert Related Categories
Analyst Comments, Hot Comments, Trader TalkRelated Entities
Needham & CompanySign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!
