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Why does the Moon look so HUGE on the horizon? I love illusions, and I love astronomy. So what could be better than combining the two?
If you’ve ever seen the Moon rising over the horizon, looking so fat and looming that you felt like you could fall right into it, then you’ve been a victim of the famous Moon Illusion. And it is an illusion, a pervasive and persuasive one.
Well, here is something that is not an illusion. It's $$$MR. MARKET$$$ and I am HUGE! Today I sold NFLX at 135.56. That's a 15% gain over my purchase price of 117.55 that I told you about right here on June 28. That's a 15% gain in only 7 weeks. That's an annualized return of 114%. Can you do that? You? YOU?? YOU??!!!
Over the same period, the S&P 500 was up a whopping 0.6%. That's so pathetic. My checking account does better than that. So let's get this straight. $$$MR. MARKET$$$ makes 15% and the overall market makes 0.6%. Can you imagine how much coin $$$MR. MARKET$$$ will make when the market actually does something?
In the meantime I will continue to pick winner after winner, but first you must declare who the greatest stock picker on the planet is. Then you have to tell a friend to join this free site. That's a pretty good deal for getting me to tell you what I'm gonna buy next.
I am HUGE!!
Bring me your finest meats and cheeses!!
$$$MR. MARKET$$$
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What are the Keys to continued Success?
If you’ve ever seen the Moon rising over the horizon, looking so fat and looming that you felt like you could fall right into it, then you’ve been a victim of the famous Moon Illusion. And it is an illusion, a pervasive and persuasive one.
Well, here is something that is not an illusion. It's $$$MR. MARKET$$$ and I am HUGE! Today I sold NFLX at 135.56. That's a 15% gain over my purchase price of 117.55 that I told you about right here on June 28. That's a 15% gain in only 7 weeks. That's an annualized return of 114%. Can you do that? You? YOU?? YOU??!!!
Over the same period, the S&P 500 was up a whopping 0.6%. That's so pathetic. My checking account does better than that. So let's get this straight. $$$MR. MARKET$$$ makes 15% and the overall market makes 0.6%. Can you imagine how much coin $$$MR. MARKET$$$ will make when the market actually does something?
In the meantime I will continue to pick winner after winner, but first you must declare who the greatest stock picker on the planet is. Then you have to tell a friend to join this free site. That's a pretty good deal for getting me to tell you what I'm gonna buy next.
I am HUGE!!
Bring me your finest meats and cheeses!!
$$$MR. MARKET$$$
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06-28-2010, 03:22 PM
NFLX ==> The Father's Day Winner
Remember when VCR’s first came out and it was so much fun to go down to the neighborhood Blockbuster store and rent movies that you could watch in the privacy of your own home. Then great big screen Tee Wees came out and there was no reason to go to the movies because you basically had one in your own house.
Well, the next big thing also came out…and it was called Netflix. For instance, if you are interested in the new movie releases and clicked on your computer screen, Killer Klownz from Outer Space might look good at first glance. So you roll your mouse onto the movie link and you instantly get all the data and ratings on the movie. It also has a viewer rating, based on actual ratings supplied by other renters. But, it doesn't stop there. Click on the movie, and you get an awesome amount of detailed information about the movie. Previews of the movie are also provided. You can’t do that in Blockbuster…and they always run out of the good movies anyway. Let’s face it. Blockbuster is toast. But remember how HUGE a company it was??? Who do you think got all their business? That’s right boys…Netflix.
Today I bought Netflix (NFLX) at 117.55. I will sell it in 4 to 6 weeks at 135.56. Here’s why I like Netflix:
With more than 13 million subscribers, Netflix, Inc. is the world’s largest subscription service streaming movies and TV episodes over the Internet and sending DVDs by mail. For $8.99 a month, Netflix members can instantly watch unlimited TV episodes and movies streamed to their TVs and computers and can receive unlimited DVDs delivered quickly to their homes. With Netflix, there are never any due dates or late fees. Members can select from a growing library of titles that can be watched instantly and a vast array of titles on DVD. Among the large and expanding base of devices that can stream movies and TV episodes from Netflix right to members’ TVs are Microsoft’s Xbox 360 and Sony’s PS3 game consoles and Nintendo’s Wii console; Blu-ray disc players from Samsung, LG and Insignia; Internet TVs from LG, Sony and VIZIO; the Roku digital video player and TiVo digital video recorders.
When you get the unlimited plan, you have access to the Netflix “Watch Immediately” feature, which allows you to watch an unlimited number of their available titles on your computer. There is also a gadget you can buy that hooks up your computer to your home theater so you can watch on the big TV. Millions of the company's subscribers are using its Watch Instantly streaming service.
The Netflix red envelopes are really cool, so you can receive and send the DVDs by mail without losing them or placing them accidentally in your stack of unread magazines. Since Netflix has so many shipping centers, DVDs are delivered quickly, usually in one or two days. The DVD collection is enormous. It includes over 100,000 titles. You can link your Netflix account to a Facebook account, so your nosey Facebook friends know which movies you liked. It actually could be a great way to get a first date, and she can come over and watch your big Tee Wee. There probably are people out there who got married because of Netflix.
Loyal Netflix addicts go to the Netflix site every day to change their queue of movies waiting to be sent to them. The company had noticed an increase in the number of subscribers browsing through Netflix.com. That can’t help but be a prognostication of more business to come. So you surf the web and click on a movie and start watching it. Imagine how awesome that would be if you are sitting in an airport for hours and hours and hours? Netflix and Apple recently announced that the movie rental service will be available on the iPhone this summer.
The announcement was made by Apple CEO Steve Jobs and Netflix CEO Reed Hastings at Apple's Worldwide Developers Conference, where the latest iPhone iteration was also unveiled.
Certainly this great business model will translate to profits. Yep Yep Yep. Certainly the investment community thinks so. Look at this chart:
What are the Keys to continued Success?
- Strong track record growing subscribers & EPS
- DVD-by-mail shipments will grow for 5+ years
- Huge opportunity in streaming
- Streaming is a service improvement, not a business
- Netflix subscription approach is differentiated
Subscribers. Netflix ended the first quarter of 2010 with approximately 13,967,000 total subscribers, representing 35 percent year-over-year growth from 10,310,000 total subscribers at the end of the first quarter of 2009 and 14 percent sequential growth from 12,268,000 subscribers at the end of the fourth quarter of 2009.
Net subscriber change in the quarter was an increase of 1,699,000 compared to an increase of 920,000 for the same period of 2009 and an increase of 1,159,000 for the fourth quarter of 2009.
Revenue for the first quarter of 2010 was $493.7 million, representing 25 percent year-over-year growth from $394.1 million for the first quarter of 2009, and 11 percent sequential growth from $444.5 million for the fourth quarter of 2009.
GAAP net income for the first quarter of 2010 was $32.3 million, or $0.59 per diluted share compared to GAAP net income of $22.4 million, or $0.37 per diluted share, for the first quarter of 2009 and GAAP net income of $30.9 million, or $0.56 per diluted share, for the fourth quarter of 2009. GAAP net income grew 44 percent on a year-over-year basis and GAAP EPS grew 59 percent on a year-over-year basis.
Don’t you wish you got a piece of Google when it first went public? This company is still in its pre-pubescent stages and new technology is providing the hormones for adolescence. An onslaught of new technology is freeing people from cable or satellite TV companies like never before by allowing customers to get shows via broadband and other means. Some people use sites like Hulu, and don't mind with waiting a couple days after the show airs on television to watch. Others figure out elaborate set ups to run their HD televisions through their PCs using applications like Windows Media Center. We may not know how to do all this, but our kids sure do. And when they are adults, it will be a normal way of life for them.
They are looking at being at 17 million subscribers at the end of the year. People are tossing out their cable boxes for Netflix. Why pay $100 per month for cable TV when you get Netflix for $8.99?? Even if the average consumer sticks with cable or satellite service for the bulk of video delivery, and then adds on a cheap Netflix subscription to fill out the back catalog, that's all the company really wants….or needs.
The company has issued the following guidance, but we all know that they are sandbagging it:
Ending subscribers of 16.5 million to 17.3 million, up from 15.5 million to 16.3 million
Revenue of $2.11 billion to $2.16 billion, up from $2.05 billion to $2.11 billion
GAAP net income of $132 million to $144 million, up from $125 million to $137 million
GAAP EPS of $2.41 to $2.63 per diluted share, up from $2.28 to $2.50 per diluted share
Revenue of $2.11 billion to $2.16 billion, up from $2.05 billion to $2.11 billion
GAAP net income of $132 million to $144 million, up from $125 million to $137 million
GAAP EPS of $2.41 to $2.63 per diluted share, up from $2.28 to $2.50 per diluted share
How do we know they are sandbagging? On June 11, the Board of Directors authorized a stock repurchase program that enables the Company to purchase up to $300 million of its common stock through the end of 2012. This repurchase program is in addition to the authorization announced in August 2009. Why did they do this? Because they know their stock is cheap compared to where it will be in the future - why else would they be buying it??
Look…the stock has gone up a long way in a short amount of time (about 200% in the last year) and its PE is around 54 so it’s not for those without bravery. But you can’t disagree that the revenue and earnings growth numbers aren’t impressive and they are fueled by 21% Return on Assets and 50% Return on Equity. This company is going to be profitable, very profitable, in the short run.
Here’s what the founder and CEO had to say:
“Our growth continued to accelerate in the first quarter, with record net subscriber additions and record-low subscriber acquisition cost,” said Netflix co-founder and CEO Reed Hastings. “It is clear that our performance, and the overall appeal of the Netflix service, is being driven by subscribers watching instantly. On that score, we reached a milestone in the quarter as more than half of all members – 55 percent and growing – enjoyed movies and TV episodes streamed from Netflix over the Internet.”
Full disclosure: I am not a Netflix subscriber. The only place I watch movies is on an airplane. I’m too busy gambling on sports and picking stock winners. So here’s another one è NFLX.
I am HUGE! Let me know if you liked this write up. If you did, make sure you tell a friend about www.mrmarketishuge.com
$$$MR. MARKET$$$
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I am HUGE! Bring me your finest meats and cheeses.
- $$$MR. MARKET$$$
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