Netflix, Inc. (NFLX) Shares Dip After Barron’s Says Shares Are Overvalued

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Shares of Netflix, Inc. (NASDAQ:NFLX) are trading down in the early afternoon today after Barron’s mentioned the company in negative terms twice over the extended weekend. Barron’s claims that Netflix, Inc. (NASDAQ:NFLX) is overvalued, especially when considering the competition of Alphabet’s Youtube. While Netflix is raking in the dough, they may have already taken advantage of most of the revenue per user they can possibly latch onto. On the other hand Youtube has 15 times times the number of users, and only earns approximately 6.5% of the revenue per users as Netflix does.

Not mentioned by Barron’s is also the fact that Amazon’s Prime subscriptions are increasing each and every week, allowing the company to leverage their userbase for acquiring the rights to additional TV shows and movies. Competition should continue to heat up for Netflix over the next couple of years.

Shares traded as low as $113.85 today before rebounding quite a bit this afternoon. The stock is down 1.02% or $1.19 following the news, hitting $116.14 per share. Approximately 5.59M shares traded hands. NFLX shares have declined 81.13% since May 22, 2015 and are currently downtrending. It has underperformed the S&P500 by 78.07%.

From a total of 25 analysts covering Netflix (NASDAQ:NFLX) stock, 20 rate it a “Buy”, 0 a “Sell”, and 5 a “Hold”. This means that 80% of the ratings are positive. The highest target price is $175 while the lowest target price is $72. The mean of all analyst targets is $132.72 which is 14.28% above today’s ($116.14) stock price. Netflix was the topic of 36 analyst reports since August 4, 2015 according to the firm StockzIntelligence Inc. Topeka Capital Markets maintained shares on November 16 with a “Buy” rating. BMO Capital Markets initiated shares with a”Market Perform” rating and a $115 target share price in their report from an October 9. Oppenheimer maintained NFLX stock in a recent report from October 15 with a “Outperform” rating. Vetr upgraded the rating on September 1. Vetr has a “Hold” rating and a $122.24 price target on shares. Finally, JP Morgan maintained the stock with a “Overweight” rating in a report they issued on an October 15.

The institutional sentiment increased to 1.54 in Q2 2015. It’s up 0.29, from 1.25 in 2015Q2. The ratio increased, as 58 funds sold all their Netflix, Inc. shares they owned while 194 reduced their positions. 149 funds bought stakes while 238 increased their total positions. Institutions now own 639.63 million shares which is 1081.93% more than the previous share count of 54.12 million in 2015Q2.

Srs Investment Management Llc holds 40.42% of its total portfolio in Netflix, Inc., equating to 11.81 million shares. Technology Crossover Management Vii Ltd. owns 5.04 million shares representing 34.23% of their total US portfolio. Moreover, Ctc Llc has 33.44% of their total portfolio invested in the company, equating to 645,718 shares. The Pennsylvania-based Barton Investment Management has a total of 29.76% of their portfolio invested in the stock. Tiger Global Management Llc, a New York-based fund reported 18.00 million shares owned.

Since February 25, 2015, the stock had 0 insider purchases, and 21 selling transactions for a total of $85.52 million in net activity. Barton Richard N sold 2,800 shares worth $281,260. Hastings Reed sold 86,037 shares worth $8.68 million. Battle A George sold 49,000 shares worth $5.29M. Cranz Tawni sold 1,512 shares worth $190,179. The insider Peters Gregory K sold 6,545 shares worth $841,491.

Netflix, Inc. is a provider of Internet television network. The company has a market cap of $50.89 billion. The Firm has over 57 million streaming members in over 50 countries. It has 309.68 P/E ratio. The Company’s members can watch more than two billion hours of television shows and movies per month, including original series, documentaries and feature films on Internet-connected screen.

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