Whitney Tilson Explains Why he Went Short and then Long Netflix [VIDEO]

Hedge fund manager and author Whitney Tilson explains his second thoughts on Netflix, whether Apple can sustain its reputation as an innovation engine, and the simplified operations of Citi. Part 2 of a 2-part interview with Steve Forbes. See part one here- Whitney Tilson in-Depth Discussion on His Investment Style [VIDEO]

Whitney Tilson interview below

Forbes: Netflix.

Tilson: Yes.

Forbes: Been one of those talk about a romance or lack of romance. You’ve been on all sides of that?

Tilson: Yes. It’s one of a half dozen stocks in my entire 15 year investing career that I’ve been both long and short. And I have yet to find an investor who has a major position in Berkshire Hathaway and is enthusiastic about something as seemingly non-value oriented as Netflix.

Forbes: Well, as you know, the stock as done sensationally. You’ve done very well with it.

Tilson: Yes. After years of purgatory, the stock went from $10 to $300, then down to $50, and now it’s up to well over $200.

Forbes: So is this one of the those “I missed it” traps?

Tilson: It’s hard for me. I think if ever in my career I’ve never had a stock quadruple in seven months. And it’s been a rocket ship, and I’ve been happy to ride it. But I believe been taking money off as it’s risen because it’s very difficult to value Netflix.

 

I can tell you what Berkshire Hathaway is worth, plus or minus 10% with high degree of confidence. With the same degree of confidence, I couldn’t tell you plus or minus 50% on Netflix, because it’s a very open-ended situation. I think in ten years, I think it has the possibility of being an enormously valuable media company that could have a market cap like Amazon’s or something of $100 billion.

Full Whitney Tilson transcript can be found here on Forbes.com