Morningstar Rating

Stock Research and Analysis

by Peter Wahlstrom, CFA

Bulls Say

The emergence of TV Everywhere from traditional pay TV distributors has been slow to roll out, giving Netflix an extended window to be the leading provider of Internet television in the U.S.
Netflix's internal recommendation software and large subscriber base could give the company an edge when deciding which content to acquire in future years.
The company's deep library of DVDs could serve as an effective differentiator in the streaming business. While Netflix's streaming content is limited, customers can rely on DVD mail rentals to access a more complete programming menu. Read more 

Bears Say

Netflix relies on unlimited bandwidth for its streaming offering. Its subscribers reportedly generate a high percentage of all Internet traffic during peak periods. Broadband providers could move to a pay-for-use model that increases the cost for subscribers.
We think Netflix is overpaying for some of its content, with Amazon and Hulu bidding up the price on library content in order to build their programming offering.
Central and South America could turn out to be unprofitable, and any material level of profitability will take at least five years to achieve. Read more 


We believe Netflix's stewardship of shareholder capital is Standard. Reed Hastings has done an outstanding job of building Netflix from scratch and moving the company from a DVD rental service to streaming. Hastings founded Netflix in 1998, owns about   Read more 


Netflix operates a video streaming service available in the U.S., Canada, and certain countries in Europe and Central and South America. Netflix delivers digital content   Read more 

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