What Was Wall Street Thinking? No Support for Netflix, CarMax's Crash, Solar Sickness, and Pink Slips at Palm
Netflix (NFLX) can't seem to catch a break, even when it's taking baby steps in the right direction.
Netflix was one of the many online companies announcing deeper integration with Facebook during the social network's f8 event this past Thursday. It will now offer subscribers in 44 of its 45 countries the ability to share online streaming queues with friends on Facebook.
The lone holdout in this list is the United States.
This isn't where Netflix messed up last week. No, it somehow figured that it would be a good idea to turn to its incensed user community for lobbying support. A 1980 law is the reason Netflix can't unlock this Facebook feature in its home country, but new legislation being introduced by some members of Congress would make it possible.
"If you want the choice to share with your friends, please email Congress to urge them to pass this modernizing legislation," Netflix says in its corporate blog.
Care to guess the kind of feedback Netflix is getting on that particular request? Most of the comments among the dozens that have been submitted are brutal. Subscribers are still complaining about the insensitive price increase that many are facing this month and the plan to inconvenience customers by splitting the DVD rental and streaming services into two different websites. Why should they help Netflix? Some are also pointing out that the government has bigger problems to worry about than simply letting everyone know that I just streamed The Expendables.
I miss the magical days -- circa early July -- when it seemed as if Netflix could do no wrong.
CarMax hits the brakes: It was also a bad week for CarMax (KMX) investors. Last week, shares of the used car retailer slipped 18% after the company posted lower-than-expected quarterly results.
The company blamed a 2% decline in same-store sales on the "weak economic environment and lower consumer confidence" during the quarter.
I get it. Things aren't rosy out there. However, I can't be the only one who thought CarMax's model was made for iffy climates. When money's tight but you still need a car, aren't CarMax's shiny showrooms with their gargantuan fleet of well-maintained used rides the place to be?
CarMax also indicated during its conference call that its average selling price per car has risen by 7% over the past year. The used car dealer is also scoring an average gross profit of $2,178 per vehicle. This all seems pretty high for a cost-conscious business.
Before you blame the economy or consumer confidence, try spending some time before the mirror, CarMax. Your fenders are on a bender.
Solar is so solo: It was a brutal summer for solar energy stocks, and the aptly titled fall hasn't been any better.
JinkoSolar (JKS) had a particularly rough week when allegations surfaced that one of its solar cell manufacturing plants in China was polluting a nearby river.
Solar energy stocks have taken a beating in recent months, as cash-strapped countries scale back on solar energy rollouts. Waning demand is now just one of JinkoSolar's problems. Its stock hit a high of $41.75 back in November. Now it's all the way down to $6.05. The sun is setting. Will it rise again?
Palm gets caught pink-slip-handed: Hewlett-Packard (HPQ) meant it when it said it was scaling back the webOS division it acquired through Palm last year.
AllThingsD reports -- and a spokesperson later confirmed -- that it began to lay off hundreds of employees last week.
Everybody knows that the TouchPad is a flop, despite the webOS tablet's brisk demand when it hit the clearance bin at $99 earlier this month. However, if HP was ever interested in finding a buyer for its Palm business, the last thing it should be doing is shaving payroll. It sends the wrong message to consumers. It also reduces its negotiating leverage with potential buyers.
The layoffs also kicked in just days before Meg Whitman was introduced as the tech stalwart's new CEO. Maybe it should have checked with its new leader before this public execution.
Longtime Motley Fool contributor Rick Munarriz owns shares of Netflix and HP, but of no other stocks in this article. Motley Fool newsletter services have recommended buying shares of and creating a bear put spread position in Netflix.