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Netflix (NFLX)
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Emcee:  Glenn Petersen Type:  Unmoderated
Investors Snap Up Shares of Netflix in Initial Nasdaq Trading

NEW YORK -- It's amazing what dropping the "dot-com" from your name can do for an initial public offering.

Netflix Inc. , an online entertainment company that, when known as had to once cancel its IPO, opened higher initial trading Thursday.

Shares of the Los Gatos, Calif. , company opened on the Nasdaq Stock Market at $16.19, 7.9% above the $15 price set on its IPO of 5.5 million shares. Near midday, the shares traded even higher at $16.95.

The offering, led by Merrill Lynch & Co . Inc. (MER), priced at the high end of price talk of $13 to $15 a share, an unusually aggressive pricing in what has been a tough market for unprofitable technology IPO hopefuls.

"To price at the top of the range, we were very fortunate," said Reed Hastings, the company's chief executive, in an interview.

Netflix is the country's best-known online entertainment subscription site, allowing users to rent three DVDs a month for a monthly subscription charge of $ 19.95.

One of Netflix's biggest advantages is its subscription model, said George Nichols, an analyst with in Chicago .

"These ongoing billing relationships, rather than one-time purchases, have annuity-like characteristics that provide a steady revenue stream," he said.

It also has some growth trends in its favor, Mr. Nichols said. "As far as consumer technologies go, DVD is still relatively young, and many new DVD players are being sold as the mass market fully adopts it."

The business isn't yet profitable, though the company has been narrowing its losses. In the first quarter, Netflix logged $30.5 million in revenue, for a $ 4.5 million net loss. In the comparable period in 2001, it lost $20.6 million on $17.1 million in revenue.

For Netflix, the offering marked a success after failing to come to market two years ago. Netflix originally filed to raise $86.3 million through Deutsche Bank in April 2000 , but the offering was withdrawn three months later as the IPO market began its long, dry period, one that still exists.

The offering was revived in March of this year, but with new terms. The company filed to sell as much as $115 million through Merrill Lynch, though, in the end, the offering raised $82.5 million.

Netflix's Mr. Hastings said he believes that the proceeds now will "give pause to our competitors" and allow the company to more aggressively market its services free to potential customers. Nine of 10 people who receive Netflix free initially end up subscribing, he said.

The challenge to the business is twofold, Mr. Hastings said. Blockbuster Inc. (BBI) recently said it would get into the mail-rental business, putting it into direct competition with Netflix.

The other, Mr. Hastings said, was getting people to feel comfortable renting DVDs online and receiving them through the mail, a process that "just sounds odd to people until they try it," he said.

Netflix featured one of the odder risks to its business in the offering documents filed with the Securities and Exchange Commission: the U.S. Postal Service. If the Postal Service does indeed raise rates this summer, it "will adversely affect our gross profit if we elect not to raise our subscription rates to offset the decrease."

Customer satisfaction might also take a hit if the Post Office stops Saturday delivery and customers can't get their DVDs in a timely fashion, Netflix said.
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1411Will do. I'm gonna watch it with my gf though. It's less scarier that waKrigannie-yesterday
1410Let's see where this goes - a doji on the daily COULD signify a reversal hermore100-Tuesday
1409It's no scarier than Stranger Things I'd say. Occasional jump scares herIntelim-Monday
1408The Biggest Factor Driving Netflix Subscriber Growth fool.comKrigannie-last Friday
1407I think it's the only NFLX show that I just refuse to watch. I'm too mucKrigannie1October 20
1406It really was. I'm currently watching the second season of ''Scream&Intelim-October 20
14055 Things Netflix, Inc. Management Wants You to Know fool.comKrigannie-October 20
14043 Reasons Netflix Stock Isn't Going Below $100 Again fool.comKrigannie-October 20
1403All the original content in 2016 was absolutely awesome. I'm long NFLX.Krigannie-October 19
1402Haha $60 target price. I admire his tenacity though, his position is adamant.Intelim-October 19
1401One analyst thinks Netflix has huge problems that Wall Street is ignoring cnbc.cJakeStraw1October 18
1400No matter what happens, you sell this as soon as possible. You lock those gains.more100-October 18
1399This There’s also the issue of enough content being available abroad. Over the Sr K-October 17
1398Netflix shakes off weak subscriber growth and its stock is skyrocketing by MatGlenn Petersen3October 17
1397Don't Expect Netflix to Enter China Anytime Soon fool.comKrigannie-October 17
1396I would think the best method would be to use a VPN that has your internet accesTimF-October 17
1395Netflix hammers cross-border watchers and there may be no way out Some unblockiGlenn Petersen-October 17
1394I made a killing with put option with last the two ERs. This time I think there more100-October 13
1393I have a strange feeling this ER will be a lot of smoke and mirrors ultimately dmore100-October 11
1392Netflix CEO says China entry doesn't look good Edward C. Baig USA TODAY 3:Glenn Petersen2October 10
1391I'm not saying this will happen for sure, but bringing the content closer toIntelim-October 6
1390There's a good chance that DIS will want to bring their content to PG-13 staJakeStraw-October 6
1389I'd say there's no chance of that. Disney puts out plenty of R-rated conJ.F. Sebastian-October 5
1388There's a good chance that DIS will want to bring their content to PG-13 staIntelim-October 5
1387Oh no, so much for high quality content... Why would you assume that..?JakeStraw-October 4
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