IB Net Payout Yields Model

Update: Netflix Q3 '14 Earnings


  • Netflix reported Q314 earnings.
  • Investors should sell the stock trading at 100x current earnings.
  • The higher content costs without the subsequent revenue was anticipated as a major problem for the stock going forward.
 Netflix (NASDAQ:NFLX) reported Q314 earnings and provided guidance for Q414 that sent the stock down nearly $100 for a roughly 20% loss. The leading Internet TV provider continues to push forward with new original content that will pressure margins and especially free cash flow over the next couple of years without any major benefits from additional revenue per subscriber. Under that model, Netflix will undoubtedly add more subscribers, but the big question is the ability to cover those costs that continue to spiral higher.

Read full article at Seeking Alpha.

 Disclosure: No positions mentioned. Please review the disclaimer page for more details.


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