Netflix stocks were trading at just under $96 which made it the worst performing stock in the S&P list.
Netflix Inc. was one of the hottest stocks in the tech industry in the past year or so. It will not be wrong to say that the shares of the company were priced for market domination. They are on a roller coaster ride and have the same adrenaline rush one has while watching streaming cable service’s original series, Jessica Jones.
The streaming cable giant is outperforming other businesses in the market and it has cemented its position. A recent study also showed that its service has caused a massive 50% drop in the television viewing time in the United States.
According to sources, Netflix stock is up by 65% in the past 12 months and it is growing stronger than ever. The main difference between the company and the cable networks is that it can spend as much as it wants on licensing content and original content whereas it is not the same for TV networks. The TV industry has not seen a bigger show than Game of Thrones as of yet, even Netflix has not but it is constantly producing hit series whereas TV networks are struggling.
Regardless of its performance, Fortune reported that the shares are not the same since December. It tried to regain as the stock was up by 17% since its low in February but shares went down again by 6%. It is now trading at just under $96. This made it the worst performing stock so far in the S&P 500 for the day.
Stock of streaming service provider are volatile and there are reasons for this. One of the major reasons is that the company is hard to predict in the open market. It is not only about the business but the industry overall is difficult to predict. Netflix does not really have a ‘true’ publicly traded competitor hence it is in such a business which changes rapidly.
It is being traded at $96 for the time being but according to analysts, it is not bad. Analysts estimated the share price to be somewhere in between $85 to $155. One analyst said that the stock has potential to reach $200 per share price in the coming two to three years.
Last week, Michael Nathanson of MoffettNathanson published his report, which concluded that people are more inclined towards Netflix, and the streaming cable service has caused about 50% drop in the TV viewing time of the US viewers. This does not mean that they are occupied in any other activities but they are watching more Netflix.
Netflix has over 75 million subscribers from 190 different countries. It opted for global expansion because of slow user growth in the United States.