The Anti-Apple: Netflix to $300 by Summer
No. 1. The same flavor of irrationality -- Apple's Crash: A Wall Street Tragedy -- that drives Apple (AAPL) down will take NFLX back up to $300.
Go ahead and laugh. But before you do, realize I've called this thing every step of the way:
Netflix's Business Model Isn't Sustainable -- Seeking Alpha, April 5, 2011.
Prepare to Buy Netflix Before It Rises From the Dead -- TheStreet, July 30, 2012.
Netflix Will Hit $300, Go Out of Business or Both -- TheStreet, January 17, 2013.
Timestamp it: NFLX will hit $300 by summer.
Why? Because Reed Hastings has fired up the smoke-and-mirrors machine yet again.
So, No. 2. Netflix has an excellent product. As somebody who covers the stock and subscribes to the service, there's no question the Netflix of 2013 is worlds better than the Netflix of 2011 from a content standpoint.
As Reed Hastings explains in the company's Q42012 Letter to Shareholders, Netflix has found its content sweet spot. It owns KidsTV. It has become an excellent outlet for prior seasons of current television shows (e.g., "Mad Men"). It's about to roll the dice on original programming. And you'll be hard-pressed to find its most popular movies and television shows on competing services such as Hulu and Amazon (AMZN) Prime.
That's all good, but it's simply not going to fly as a business at $8 per month.