Netflix, Inc. (NASDAQ:NFLX) shares rose by more than 2% on today’s market as interest in the firm’s original television offerings continued to rise. The company’s premiere series, House of Cards, is off to a strong start, according to a report released today, and the firm is expected to offer more promising series throughout 2013.
A JPMorgan Chase & Co. (NYSE:JPM) analysts stated that House of Cards looked like it was off to a good start, just twelve days after its initial release. The analyst raised his target on the company’s stock from $180 to $205. The report looked at the company’s future, suggesting that original programming would be a force for growth at the company.
Another report on the tech firm, from Morgan Stanley (NYSE:MS), gave a more detailed look at the firm’s hopes in the original programming department going forward. The report, rather cynically if accurately, points to children’s programming as a great opportunity for Netflix, Inc. (NASDAQ:NFLX).
That reasoning followed these lines:”Children are a great target demographic because they can watch the same content over and over without as much fatigue as an adult. Additionally, because their taste-preferences are not yet fully developed, children’s content tends to be more universally relevant.”
The sentiment makes great business sense, and is unlikely to offend many children. Other benefits of original programming include the ability to distribute content worldwide without the cost and hassle of negotiation content deals for each individual show and network. Original programming, along with the expansion of other content deals, are building quite a moat for Netflix.
One of the most anticipated launches is the Dreamworks Animated production Turbo: F.A.S.T in December. This targets the children’s demographic that the Morgan Stanley (NYSE:MS) sees as such an opportunity, introducing kids to Netflix in a big way. The release of cult classic, Arrested Development, on the Netflix platform will also boost its appeal among young adults.
Netflix is beginning to grow as a company, and it is expanding into an area where it gets to decide its own destiny, rather than rely on deals with partners who are directly competing with the company. The movement into original content is a maturation of Netflix. It’s a growth that investors can believe in.
Netflix, Inc. (NASDAQ:NFLX) shares have risen by nearly 100% since the start of 2013 on positive earnings numbers and success in original content. Analysts are expecting much more from the company. Netflix shares are trading at $183.92 at time of writing.