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The Art Of Valuing Netflix- Mott Capital Daily Market Recap
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Netflix Rant
Netflix shares continue to jump higher since last week when we noted the substantial break out in the stock. The stock rose by nearly 5 percent on the day and finished the day over $201. We noted on December 28, how the stock appeared to have broken and it sure did today. The stock got an upgrade today from Macquarie, who put a price target of $220 per share on the stock.
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These are the type of upgrades you have to love. Now I didn’t read the full report, but I read the notes like the one linked above, but is it possible that the market JUST realized Netflix is years ahead of its peers? It is a “no duh” moment. There is no streaming platform on par with Netflix currently, none. Amazon has the look and feels of the minor league, while Hulu can’t even catch my attention.
Price Target?
The price target is another point of craziness. How can you value Netflix, a company that is reshaping the media landscape, and the viewing habits of consumers? I could not tell you how much Netflix should be worth. What I can tell you, is that if Netflix continues to grow its subscribers globally, and continues to create the content, it has now, like Ozark, the Crown, and Stranger Things, or can find shows like Frontier, then it should be worth a lot more in 5 or 10 years times.
The impact Netflix is having on consumer habits and the media landscape, can’t be modeled because it has never been done before.
Competition?
To the tune of competition, there is no competition, because watching content is not a “zero-sum game.” Do you have only HBO or do you have HBO and Showtime? Do you have just ABC or do you ABC and NBC. Netflix is another choice
I find watching Netflix on my iPad to be the best viewing experience, with my headsets in. I can watch what I want in my bed, in a chair, at the gym, wherever The headset drowns out all the distraction from the outside and lets you get into the show. The screen is not an issue either if you hold it at the right distance.
The day that 5G rolls out is the day the broadband connection to your home and wifi likely die. But we can get into that topic another day.
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S&P 500
The S&P 500 increased by about 75 bps and finished the day at 2,694.41. The S&P 500 continues to look strong here, and it appears the market is getting ready to turn higher, and move up and beyond 2,700 on a technical basis.
spx by Scorpio244 on TradingView.com
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Biotech
The Biotech ETF rose by nearly 2.5 percent and has now escaped the grip of resistance at $107. It struggled mightly at that level, but now with the ETF trading at almost $109.50, it seems well on its way back to about $114.
In our latest premium video, I discuss exactly why I think the Biotech stocks may very well, be the performing group in 2018.
Biotech May Outperform in 2018 from Michael Kramer on Vimeo.
Tesla
Tesla shares appear to have broken out, ahead of what could be a critical day for the company. Tomorrow should be the day, we find out how many Model 3 were delivered, and maybe, a longshot maybe what the pace of production per week is.
The chart below show how Tesla cleared key resistance at the $319 level.Â
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Amazon Seller?
Look at this chart on Amazon, notice anything? I’m wondering if the seller in Amazon, is the same shop that was selling Netflix, because it appears clear as day, that there is a seller lurking in this stock around the $1,192 price. As if picking an oddball limit would camouflage them. Since December 15 the stock has risen above 1,192, for now, the third time, and each time, the stock can’t break through.
It looks like someone is just leaning on the shares, and once that seller “cleans up”, it seems like Amazon follows in Netflix’s footsteps.
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Michael Kramer and the Clients of Mott Capital own shares of NFLX, TSLA
Mott Capital Management, LLC is a registered investment adviser. Information presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. Investments involve risk and unless otherwise stated, are not guaranteed. Be sure to first consult with a qualified financial adviser and/or tax professional before implementing any strategy discussed herein. Upon request, the advisor will provide a list of all recommendations made during the past twelve months. Past performance is not indicative of future.
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Tags: #Netflix #tesla #amazon #stocks #biotech #sp500
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Charts used with the permission of Bloomberg Finance L.P. This report contains independent commentary to be used for informational and educational purposes only. Michael Kramer is a member and investment adviser representative with Mott Capital Management. Mr. Kramer is not affiliated with this company and does not serve on the board of any related company that issued this stock. All opinions and analyses presented by Michael Kramer in this analysis or market report are solely Michael Kramer’s views. Readers should not treat any opinion, viewpoint, or prediction expressed by Michael Kramer as a specific solicitation or recommendation to buy or sell a particular security or follow a particular strategy. Michael Kramer’s analyses are based upon information and independent research that he considers reliable, but neither Michael Kramer nor Mott Capital Management guarantees its completeness or accuracy, and it should not be relied upon as such. Michael Kramer is not under any obligation to update or correct any information presented in his analyses. Mr. Kramer’s statements, guidance, and opinions are subject to change without notice. Past performance is not indicative of future results. Neither Michael Kramer nor Mott Capital Management guarantees any specific outcome or profit. You should be aware of the real risk of loss in following any strategy or investment commentary presented in this analysis. Strategies or investments discussed may fluctuate in price or value. Investments or strategies mentioned in this analysis may not be suitable for you. This material does not consider your particular investment objectives, financial situation, or needs and is not intended as a recommendation appropriate for you. You must make an independent decision regarding investments or strategies in this analysis. Upon request, the advisor will provide a list of all recommendations made during the past twelve months. Before acting on information in this analysis, you should consider whether it is suitable for your circumstances and strongly consider seeking advice from your own financial or investment adviser to determine the suitability of any investment.
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