Money Minute: Netflix Headed for a Fall? Starbucks Loses a Venti Lawsuit

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Netflix and Starbucks, two of the market's hottest stocks this year, face some bumps in the road. That and more of the top money stories you need to know today.

Netflix website
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There's a new Netflix (NFLX) drama, and this one may not end well for the company. An article in Barron's claims Netflix could be in danger of giving up as much as half of its recent big stock market gains. The report says an ongoing cash shortfall could start to catch up with the company soon, as it continues to invest heavily in new programming. Netflix shares have soared by more than 300 percent over the past year. (Meanwhile, the streaming video giant just rolled out a new look for its TV interface.)

Starbucks (SBUX) has lost a legal battle that will cost it $2.8 billion. An arbitrator ruled that Starbucks prematurely ended a grocery-store distribution agreement with Kraft (KRFT). But Kraft isn't celebrating. It doesn't get the money. Instead it goes to Mondelez (MDLZ), which spun off Kraft about a year ago.

The Dow Industrials (^DJI) fell 32 points yesterday. The S&P 500 (^GPSC) lost 4 a single point and the Nasdaq (^IXIC) was virtually flat.

Johnson & Johnson (JNJ) has reportedly agreed to pay $4 billion to settle thousands of lawsuits tied to a hip implant device that was recalled. The company could be the hook for a lot more. Patients who run into problems at a later date can still file for compensation.

Tesla (TSLA) stock fell Tuesday on rumors the company could recall some of its luxury cars because of several fires. But after the bell, CEO Elon Musk said that the fire risk for the Model S is less than one-sixth the average for a gas-fueled vehicle, that the cars' safety features probably saved the drivers (none of whom were injured), and that no recall is planned.

Shares of the trucking company YRC Worldwide (YRCW) are about to skid off the road. The company posted a much bigger than expected quarterly loss. Its heavy debt load is increasing pressure on YRC to consider filing for bankruptcy protection.

But investors are hungry to pick up shares of the sandwich chain Potbelly (PBPB) following better than expected earnings. Potbelly stock doubled in price on the first day of trading last month, but has lost ground since then.

-Produced by Drew Trachtenberg

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14 Comments

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IN MY OPINION ONLY

Both companies deserved that?

November 15 2013 at 3:08 PM Report abuse rate up rate down Reply
tony.bonbon

Another reason why companiesare moving to China. I would to.

November 14 2013 at 2:19 AM Report abuse rate up rate down Reply
loveeurope2

Love to have Netflix back. But have tremendous problems streaming. Amazon works perfect, so it cannot be my equipment. Netflix has a far better choice in movies and series, but does not work for me.

November 13 2013 at 11:51 PM Report abuse rate up rate down Reply
bjack901

Netflix is so much better than watching regular T.V. or cable. T.V. sucks nowadays. With all those reality T.V. shows Netflix is so much better without those crazy commercials.

November 13 2013 at 9:35 PM Report abuse +2 rate up rate down Reply
sportscardmarket

I never have a problem streaming that isn't related to an internet outage. They did drop a lot of content, but have added more recently, especially their original content, which is excellent. I have over 300 items in my instant queue, so there is plenty to watch. It sounds like there will be a buy opportunity after the stock drops!

November 13 2013 at 1:55 PM Report abuse rate up rate down Reply
linriolo

I don't see how Netflix can go wrong by investing in more original shows. I joined for House of Cards and stayed for Orange is The New Black. I would much rather see good original series than old movies. I have never had a problem streaming movies.

November 13 2013 at 1:08 PM Report abuse +3 rate up rate down Reply
richsglobal

Netflix Sux. Half The Times The Streaming Quits. Of Course It Is A 3 Way Blaming Game Between Netflix, The DVD/WiFi Manufacturer And The Cable Company. They All Claim The Other Equipment I Have Is Good. Also Netflix Programming And Recent Half Way Decent Movies Are Non Existant,. Unless You Like Re-Runs Of TV Shows

November 13 2013 at 11:04 AM Report abuse -4 rate up rate down Reply
3 replies to richsglobal's comment
jdykbpl45

Is the sky going to fall?

November 13 2013 at 10:13 AM Report abuse rate up rate down Reply
beverlyamy1

i love me some netflix,beats the hell out of cable and dish.

November 13 2013 at 8:54 AM Report abuse +3 rate up rate down Reply
1 reply to beverlyamy1's comment
jlaka272

You obviously don't watch sports. Granted, PLENTY of ways to stream ANY sporting event for free but I prefer a clear picture and the ability to watch shows when they happen and not have to wait. Yes, I'm the spoiler alert person that talks about a new episode the next day at work and all the Netflix folks whine and complain. Oh well....

November 13 2013 at 10:59 AM Report abuse -1 rate up rate down Reply
1 reply to jlaka272's comment
beverlyamy1

oh i have direct tv n.b.a. league pass,but at 80 a month plus 100 for the nba package netflix beats them all.

November 13 2013 at 1:04 PM Report abuse +1 rate up rate down