I absolutely love how people consider AMZN, GOOG & AAPL competitors of NFLX because they too offer streaming videos. Seriously, just because my dad owns a grocery store does not automatically make him a competitor of Walmart. I have yet to come across an individual who has paid money to stream movies/shows/videos on AMZN or AAPL yet I can walk outside right now and ask 10 people if they have watched anything on their TV via Netflix and I am bound to get more than one yes I have. NFLX’s market cap of almost $10 billion rivals some of the biggest names in the S&P 500 and is the darling of Wall Street. NFLX is a market leading company in the space for entertainment going into the future and this isn’t the first time Netflix PE has jumped into the stratosphere and it probably won’t be the last.
Dian Chu said it well with “So far, it has been smooth sailing for the California-based company. Netflix went public in 2002, and its mail DVD rental with no late fees model essentially sent Blockbuster packing into Chapter 11 (albeit a lot has to do with Blockbuster’s inability to adapt to new trend and technology.)
In addition to the mail DVD rental business, Netflix also has morphed into a formidable internet content provider, setting itself apart of the competition by successfully rolling out a slick Internet video streaming service in 2008, directly to a subscriber’s TV set, bypassing the cable box.
Netflix stocks has really taken off since 2008 — up 800% in two years (see historic chart), as Netflix was probably one of the very few companies that were growing and profitable during the Great Recession”
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