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Netflix (NFLX)
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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 Netflix originally filed to raise $86.3 million through Deutsche Bank in April 2000 , but the offering was withdrawn three months later as the IPO market began its long, dry period, one that still exists.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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1362Looks ready. $99 gets 101.50 and then $104 and possibly 108. There has been a chmore100-5 AM
1361This is going to move sideways today. MM will manipulate to where they want it. more100-August 19
1360Watch this trend line for a upside break at $97 for short-term direction. [grapmore100-August 18 Netflix Expands Hospitality Offering Through Expanded Enseo ASr K-August 17
1358Netflix looks ok, paused with the rest of FANG. BB beginning to come in, a big mmore100-August 16
1357Conviction overturned for case spotlighted in 'Making a Murderer' [grapSr K-August 13
1356There's news, a reversal, in the "Making A Murderer" case (a 10-paSr K-August 12
1355You know your analysts done screwed up when they missed on domestic subscriber gIntelim-July 20
1354I don't own any now but as soon as this looks bullish I'll consider swinmore100-July 20
1353It looks like a bloody market day with futures down. How low will it go? They remore100-July 19
1352Hastings and Netflix never give "guidance" that way; they share their Sr K-July 19
1351Netflix blew its Q2 subscriber numbers, and blamed it on press about its price hGlenn Petersen1July 18
1350Letter to Shareholders files.shareholder.comJakeStraw-July 18
1349 Netflix to Stream ‘Star Trek’ Episodes to Global Subscribers JSr K-July 18
1348The July 13 episode of Chelsea was another good one. She interviewed Vicente FoxSr K-July 14
1347I can already see SWAT teams banging on people's doors because they share a Intelim-July 13
1346Sharing Netflix or HBO Go Passwords Is Technically Federal Crime Under 9th CircuGlenn Petersen1July 12
1345The Friday (7/8) episode of Chelsea ended with about 20 seconds promoting a nextSr K-July 12
1344'When everyone starts downgrading a stock, it's usually time to buy.'more100-July 12
1343Thank you for sharing, one of the best articles on Netflix I've ever read!Intelim-June 20
1342Can Netflix Survive in the New World It Created? It helped to develop all the nGlenn Petersen5June 19
1341NFLX is so overvaluated, is burning his cash, look at the last quarters Cash FroGColoB_90-May 31
1340(5/25/2016) Reed Hastings (CEO,DIR) of Netflix Inc. (NFLX) sold 85,659 shares atGColoB_90-May 31
1339Netflix CEO Reed Hastings On The Future Of Streaming, Competition and More entm.GColoB_90-May 31
1338Netflix could be forced to spend up to 26% of its French revenue bankrolling EurTimF-May 26
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