Netflix is run by geniuses and I'm glad that I didn't sell. If this keeps up I'm going to play bigger.

im pretty close to shorting it. I dont think it will drop under $200 TS so dont know if id be playing those options, but upside is clearly limited here. If they execute perfectly maybe it compounds at 3% from here for next 10 years

Also would like to wait until DIS wins fox content over say, comcast, before shorting

^^ still a lot of excitement about this stock. Maybe wait for 400?

Gentleman's bet? $100 to me if it drops below $200 before January 17th, 2020. $100 to you otherwise.

Interestingly, someone dropped nearly $500K yesterday in a single transaction on this exact strike/date:
What are the odds they read 2p2? Anyone want to fess up?

I don't think there's any great hurry. Investors are largely stupid and backward looking and won't change their mind until they see concrete proof. This is a play on 2019 Disney going live and the 98+% chance that this will put Netflix in permanent contraction, which will destroy the stock pretty quickly.

Netflix will end up around $70 or so by early 2020, maybe as late as mid if Disney is slow releasing their streaming service.

Still. It's at crazy highs right now and it's be a shame to not at least start building a position. With the caveat you might double/triple/quad up on your puts at half the price or double the price to fill out your position.

fwiw, I think the same thing now as when it was $200. I still don't see how it's worth a 200 P/E ratio. I'll be wrong again at some point on something I'm sure. Guess I'll short right around when literally everyone insists it's a buy. That's usually a good time.

yeah id bet 100 it doesnt tag under 200 at any point before that date. reply to confirm

Confirmed. I owe you $100 if it doesn't go below $200 by Jan 17, 2020. You owe me $100 otherwise.

It's about $70 free money for you since you can hedge it easily, it's more a fun thing for a tiny bit of money.

These are currently going for $8.40 with stock at all time high are you referring to the June 2019s?

No clue how you can call the 2020 or 2019 options 50% chance of being 10 baggers if this is all you have. Netflix is growing subscribers 50% Y/Y their international numbers are phenomenal and its basically all that wall st. gives a **** about. Disney streaming will not take any customers from Netflix, they're launching domestically and aren't even looking to expand to international markets for years to come. The service they are releasing is looking like a joke

https://www.theverge.com/2018/2/8/16...school-musical

"Per the report, Disney is looking to debut four to five original movies and TV series during the first year of the service, which will launch in America first before expanding internationally later on. Disney is also said to be sticking with family-friendly programming that fits the Disney brand, with no R-rated movies whatsoever. More adult-tilted content will be funneled to Hulu, and the company is said to be leaving its darker and more violent Marvel Netflix series where they are for now. There’s also no word at all on 20th Century Fox content, or what role that studio’s output may play in the upcoming service."

No one is going to cancel their Netflix subscription over this joke of a service even if they end up landing the Fox library people want original content and Netflix already has huge head start with what subs will watch and continue to pay for. Its highly unlikely Disney will be stealing subs away from Netflix more likely is that at some point Disney service will be worth subscribing too and you'll have people paying for both.

I completely agree. Netflix is entrenched and unless they completely screw up will remain entrenched. Streaming is the future and there is room for Netflix, Hulu, Amazon, Disney and smaller niche players. People will (and already do) have multiple streaming options.

If you want to short the loser in this dynamic that would be the cable companies. Cords will continue to pick up steam in getting cut.

maybe people do end up subscribing to both but if thats the case it certainly puts a limit on netflix's pricing power.

in my outlook I assume netflix raises prices to $15 a month over next decade. not sure what others expect

actually you would short satellite companies. cablecos just keep raising prices on their internet product and consumers seem fine with that.

sat companies getting destroyed. ATT's directv's losses last quarter were horrible. I saw ATT's IR guy couple weeks ago, their arpu on satellite is like 120 and on directv now is 20. its pretty horrible dynamic for them.

I agree that if this was a true statement, it would not be a short. But it's not at all a true statement. Netflix are growing subscriber number 5%/quarter, not 50%/year.

Agreed, hence the short thesis. Disney needs to take away very few customers on launch to stop Netflix's growth dead - at which point the stock crashes. North America is approaching saturation, which means it goes into serious decline for Netflix when Disney arrives. What do you think that will do to the stock? If Netflix can't hold existing subs, the model where they'll raise prices a lot eventually to finally become profitable dies in a grease fire.

Disney has a large international presence and so does Fox, which Disney has acquired. Fox for example has a large amount of local Indian content, which Netflix will struggle to compete with.

Have a look at the stations and brands and studios that Fox (now Disney) owns.

https://en.wikipedia.org/wiki/List_o...st_Century_Fox

A huge number of top of the line US and International assets which produce large amounts of highly rated original content.
This is self evidently an absurd statement.

[citation needed] for the bolded.

Do you think this is a reasonable position? On content alone they have Netflix crushed right out of the gate. If the article is true - big if - not everyone is a horny toad. More likely they'll have tiers of service and parental controls in the package - more adult if you want it.

Do you think this is a reasonable position? People want tons of stuff to watch, not "original content", whatever that means - everything you haven't already watched is original content. Disney will have plenty of that, they churn out tons of shows regularly. You do realize they have a whole channel, right, churning out original content? Multiple top in their class series/franchises, churning out original content? Now add Fox on top of that and a blockbuster movie studio, plus whatever they want to buy with their deep pockets. And someone you think Netflix will have them beat on "original content"? Are you high? Here is a list of what they own - it crushes Netflix on the quality and rate of original content production:

https://en.wikipedia.org/wiki/List_o...Media_Networks

Netflix has to do (rather ****ty second grade) original content because they can't afford proper content, and have to pad their ****ty second and third tier bought offerings with stuff they do in house. You really think their original content stacks up against what Disney + Fox has to offer?

Again it's a numbers game. Some will pay for both, most people won't/don't. Work out the number of people that Disney needs to take with their cheaper subscription and superior content, work out Netflix's growth rate (it's not even close to what you think it is), and do the math. US subscriber decline after Disney's launch is a certainty.

If you don't realize that, look at Netflix churn and satisfaction rates. The former is very high, and latter is only moderately high. If the 22% of Netflix consumers who report low satisfaction with the service have somewhere else to go, with far better content and far more original content rather than the second and third tier garbage Netflix makes, what happens to Netflix's numbers? Do you think these 22% with low satisfaction keep both services?

Actually I wouldn't short any of this stuff but yeah ATT is getting killed with cord cutters. And the cable companies are also the internet provider so they will always have that and will shift from the cable portion to the internet portion.

I think one of Netflix biggest possible missteps right now may be the alienation of the right with putting Rice on the board, throwing cash at Obama and signing on Michelle Wolf. There is a HUGE shift to tribalism and Us vs. Them mentalities permeating through society and getting too political by pandering to one side or the other could eventually become suicidal.

But I think the bottom line is that this entire industry has been disrupted and the clear cut future is that streaming will become the main method of viewing entertainment content. This means the consumer will have several streaming subscriptions and cable will die. The network model is over and there will be several streaming options that will thrive and survive. Netflix is the current leader and I don't see Disney as even a minor threat.

The idea that the market doesn't understand the implications of Disney getting into streaming EVENTUALLY is laughable. It's the reason their stock continues to go nowhere, the big media players are all in varying degrees of trouble right now because of cord cutting/move to services like Netflix/YouTube/Amazon/Twitch etc especially the younger you go. It's why the TWX T merger has to be allowed and will be approved in the coming weeks.

Also do your homework TS, Disney doesn't own FOX yet and in fact Comcast has a better offer they are going to make possibly next week. If we chastise NFLX for overpaying for content then Disney probably shouldn't get a pass for doing the same here (considerably more than they spent on Lucas, Marvel, Pixar combined) IF the deal closes.

You seem to not understand many users of NFLX own more than one service & I doubt it would be the first to go if people cut back due to pricing/economy getting worse etc.

I can't think of anyone I know that doesn't have Netflix AND Amazon prime. Many also have Hulu and premium channel subs like HBO and Showtime outside of cable because they cut it already. Cable is dead, networks are dead, streaming is the new normal and people will have every sub that has programming that appeals to them. Streaming subs aren't an either or proposition and people will have multiples.

What are millennials and younger going to cut in a future recession, spending on clothes/material possessions/upgrading housing/eating out/experiences or their streaming service? I think the chart is telling you all you need to know. I mentioned a couple pages back they had that survey asking if people would pay more for NFLX and the majority said yes with some saying they'd pay up to $20 month lol. Could be a function of the good economy but still that's power you can't buy or manufacture even from a big player like Disney (for now).

Thoughts on Roku?

Good numbers recently but little moat and too small a player in this space. Android TV is coming too.

I kind of expect streaming to be recession proof in a similar fashion to booze, cigarettes, and drugs. On a dollar per entertainment hour basis streaming is so cheap it's basically free. The poorest people I know all come up w/ $10 per day for cigarettes.

For $150 per year you're almost guaranteed that your streaming service will put out at least 2-3 series you'll enjoy, a few shows of your favorite genre (cooking, docs, nature, etc.), and there'll be at least a couple of movies you want to see.


That's a lot of cheap entertainment if you're struggling financially, especially if you combine it with the occasional savings of eating, drinking, smoking, or doing drugs at home, while binge watching, as opposed to going out.

I'm in this camp...I think a recession would just further increase cord cutting at a rapidly accelerated pace. Netflix has so much damn content and so many great series that users can binge and it appeals to different demos/genres...creatives also love working with them. People aren't going to start canceling their $15 or $20 subscription if the economy goes in the ****ter. What will cause them to cancel it is if the content goes stale

dont think anyone here is arguing netflix is a great service and is doing well. thats obvious to everyone. but no where do I see anyone putting out numbers to come up with a valuation. you're all missing half the equation

Yeah no one disagrees that Netflix is the lead streaming service right now or that it's a better value proposition than cable. In fact it speaks to how utterly crap Netflix content is that despite being far cheaper and far more convenient, the far more expensive cable is still doing so well and surviving as well as it has.

Also, no one disagrees that some people will have multiple services. Again, the bear case here is that:

- Some percentage (>20%, <30%) aren't that happy with Netflix
- Turnover rates aren't that great
- A quality alternative service will pull people away from Netflix and compete for new customers - those claiming that Netflix will lose no or very few customers or new subscribers because customers will simply double up on subscriptions have disqualified themselves from serious commentary
- The bull case for Netflix at anything greater than $100 requires prices to go up 50-100% from current levels, without much subscriber loss.
- A quality streaming service with deep pockets and superior content and a stated strategy of underpricing current Netflix prices for years in order to grow subscribers as rapidly as possible is both going to kill the possibility of pricing increases for years and kill subscriber growth if there's even a small level of switching, which is a certainty.

Also, no one really talks about subscriber acquisition costs that Netflix has.



They don't matter when there's no one else with better content, but these kinds of numbers are death when you have a viable competitor with very deep pockets under pricing you.