Why Netflix Is Poised to Pull Back

Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, movie rental service Netflix has received a distressing two-star ranking.

With that in mind, let's take a closer look at Netflix and see what CAPS investors are saying about the stock right now.

Netflix facts

Headquarters (founded)

Los Gatos, Calif. (1997)

Market Cap

$9.0 billion

Industry

Internet retail

Trailing-12-Month Revenue

$3.6 billion

Management

Founder/Chairman/CEO Reed Hastings

CFO David Wells

Return on Equity (average, past 3 years)

38.9%

Cash/Debt

$748.1 million / $400.0 million

Competitors

Apple

Comcast

Amazon


Sources: S&P Capital IQ and Motley Fool CAPS.

On CAPS, 19% of the 9,637 members who have rated Netflix believe the stock will underperform the S&P 500 going forward.

Just last week, one of those Fools, All-Star miclane05, tapped the stock's recent surge as particularly unsustainable:

[Netflix] might succeed in fending off hula, [C]omcast, and others, ink some long term content deals like the one with [D]isney, and be successful, but ... this stock has gotten way ahead of itself. This is not a high growth company and, at this P/E (or PEG) anything less than a grand slam will look like a loss. At this price, anything but the smallest position in a real-money portfolio is a pure gamble.

Of course, this short pitch doesn't even come close to telling the entire story of Netflix. You're in luck, though. The Fool's brand new premium report on Netflix tells all sides of the story for one of the most compelling tech companies in the world. You can grab your copy now, which comes with free updates for 12 months, by just clicking here.

Want to see how well (or not so well) the stocks in this series are performing? Follow the TrackPoisedTo CAPS account.

The article Why Netflix Is Poised to Pull Back originally appeared on Fool.com.

Fool contributor Brian Pacampara has no position in any stocks mentioned. The Motley Fool recommends Amazon.com, Apple, Netflix, and Walt Disney. The Motley Fool owns shares of Amazon.com, Apple, Netflix, and Walt Disney. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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