Netflix, Inc. From 85 Cents To $102 In 13 Years. Thanks To Internet

Netflix, Inc. From 85 Cents To $102 In 13 Years. Thanks To Internet
NFLX Photo by Matt Perreault

Netflix is expanding globally at a fast pace, and CNBC’s Jim Cramer thinks that by the end of 2017, it can take over the whole world if it intends to. Recently Cramer got an opportunity to discuss the current environment of the Internet, how Netflix obtained rapid success, and where the company will go in the future with Netflix Chairman and CEO Reed Hastings.

Pullback offers buying opportunity

Cramer pointed out that Netflix traded at just 85 cents a share 13 years ago, and on Friday shares closed at $102. Explaining the streaming firm’s fast growth, Hastings said, “It’s really the Internet. The Internet is transforming so many sectors of our economy, and we are Internet TV; and that sector has grown from very small 15 years ago to starting to be significant now.”

Gates Capital Management Reduces Risk After Rare Down Year [Exclusive]

Gates Capital Management's ECF Value Funds have a fantastic track record. The funds (full-name Excess Cash Flow Value Funds), which invest in an event-driven equity and credit strategy, have produced a 12.6% annualised return over the past 26 years. The funds added 7.7% overall in the second half of 2022, outperforming the 3.4% return for Read More

What’s more impressive is that Netflix stock is still the best performer in the S&P 500 and is up by more than 100% for the year. On whether the recent pullback provides a buying opportunity, the Mad Money host said, “When you get this kind of retreat in the stock, historically—as I always tell you, through thick and thin—it’s been a terrific buying opportunity.” And in the worst case, if the stock drops further, it gives investors a better chance to buy shares cheaper before they rebound.

Internet driving Netflix’s success

Netflix is a video streaming colossus, streaming TV shows and movies to its subscribers and also creating original programming. The company confirmed that it added 3.3 million new subscribers in the quarter ending in July.

Hastings predicts that in the next 10 to 20 years, all of television will be on the Internet. The Netflix CEO said that while starting Netflix, he wa prepared to bet that the Internet would be a fast growing industry as he had seen the incredible consumer experiences it allowed.

Hastings said Netflix’s data analytics is the primary reason behind the success of its original programs such as House of Cards and Orange is the New Black. Comparing Netflix to a learning machine, Hastings said every time they add a new show, they try to figure out what audiences do and don’t appreciate. This helps them come up with a better show the next time.

No posts to display