Will Netflix, Inc. (NFLX) Thrive in India With a Net National Income of Just $1310?


A lot has been made about Netflix, Inc.’s (NASDAQ:NFLX) move to India. In fact, much of yesterday’s stock move to the upside can probably be attributed to the fact that India is one of the countries in the list of 130 newly added nations for the Netflix library.

With this said, however, we ponder whether or not Netflix’s (NASDAQ:NFLX) move to India is really all that it is hyped up to be. Consider the fact that the national net income in India stands at just around $1310 per capita, compared to over $55,000 in the United States, a pricing plan starting at $7.50 per month may just be a little steep for the developing country.

India does have one thing on their side, however, and that is the fact that Indians love their movies. This is seen with Bollywood films, and their increasing popularity, not just in India, but internationally. In fact, many people in the United States have begun to take note of the quality films coming from India.

Without a doubt, the Netflix, Inc. (NASDAQ:NFLX) move to India will certainly add revenue and profit to the company’s balance sheet, but how much, how soon is yet to be determined.

The stock is down 3.86% or $4.55 following the news, hitting $113.13 per share. About 25.09M shares traded hands or 64.63% up from the average. NFLX has risen 32.51% since June 3, 2015 and is uptrending. It has outperformed the S&P500 by 38.37%.

From a total of 26 analysts covering Netflix (NASDAQ:NFLX) stock, 20 rate it a “Buy”, 0 a “Sell”, and 6 a “Hold”. This means that 77% 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 $132.18 which is 16.84% above today’s ($113.13) stock price. Netflix was the topic of 37 analyst reports since August 4, 2015 according to the firm StockzIntelligence Inc. Robert W. Baird downgraded shares on January 4 to a “Neutral” rating. JP Morgan maintained shares with a”Overweight” rating and a $137 target share price in their report from an October 15. FBR Capital maintained NFLX stock in a recent report from October 15 with a “Outperform” rating. BMO Capital Markets initiated the rating on October 9. BMO Capital Markets has a “Market Perform” rating and a $115 price target on shares. Finally, Credit Suisse maintained the stock with a “Neutral” 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 improved, 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 sales 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 $8.68M. 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 $48.26 billion. The Firm has over 57 million streaming members in over 50 countries. It has 301.67 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.