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Albert Fried & Company Starts Netflix (NFLX) at Under Perform, Likens Takeover to Time Warner/AOL

November 16, 2012 8:33 AM EST
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    43 Buy, 27 Hold, 4 Sell

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Today's Overall Ratings:
    Up: 9 | Down: 7 | New: 39
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Albert Fried & Company initiates coverage on Netflix (NASDAQ: NFLX) with an Under Perform rating an NO price target. On takeover speculation, the firm likens it to the 2001 failed merger between Time Warner and AOL, highlighting hidden costs to a deal.

The firm comments, "On the surface, some investors think $4 billion is bite sized but NFLX is not an A La Carte investment proposition. The real cost to acquire NFLX is closer to $10 billion in our view. Management's investment expense guidance and a large $5 billion content liability could quickly turn a light meal into a strategic corporate ulcer, in our view. The TWX (NC) and AOL (NC) deal in 2001 was also highlighted by a large subscriber base and media transition but failed owing to subscriber losses and the failure to integrate a vision -a NFLX deal speculation is based on similar arguments, in our view."

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 $79.78 yesterday.


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