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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 Netflix originally filed to raise $86.3 million through Deutsche Bank in April 2000 , but the offering was withdrawn three months later as the IPO market began its long, dry period, one that still exists.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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1228So, does Neftlix expands to Australia or not? I'm not even sure the "AuKrigannie-Tuesday
1227$NFLX Yesterday we nailed the support area at 102$ Will it happen the same todaymore100-November 17
1226$NFLX starting to look interesting again[graphic]SybilNicolas-November 12
1225$NFLX looking for call entry off drop 110p ~ 50% from open DT.more100-November 11
1224Netflix seems to go up...and down...and up...and down...yet always return to theKrigannie-November 9
1223$NFLX ah the N in FANG showing it's teeth. I got an awesome execution off thmore100-November 5
1222$NFLX total gets crushed when it makes a couple up bars. Just out of more100-November 3
1221Netflix is re-creating the entertainment distribution model. Content creation isKrigannie1November 2
1220$NFLX 105c rocking ~ 100% from low. I missed this one busy with other ER plays. more1001October 28
1219Netflix's market is for unlimited access to a library of TV programming, notKrigannie-October 27
1218I am glad that Netflix keeps its streaming subscription simple. One streaming seKrigannie-October 27
1217Netflix update to v3.15.2 states Coming soon: Call Netflix Help directly from tSr K-October 19
1216 One in ten Australian households now subscribes to Netflix 18
1215It would be helpful if they would share how much of the churn were credit cardKrigannie-October 16
1214Q3 Results and Q4 Forecast Global membership grew 3.62 million to 69.17 million drmicrocap-October 16
1213Netflix ($NFLX) was trading around $109 ahead of earnings yester night and the smore100-October 15
1212Well that was quite a recovery. Must have been one heck of a conference call :)Ron-October 14
1211keep lookingSr K-October 14
1210Netflix drops hard after hours on earnings, fewer subscriptions added than expecRon-October 14
1209Hard to short a mo-mo stock....this chart is setting up for a positive earnings J.B.C.-October 10
1208deletedJ.B.C.-October 10
1207Netflix raising US price for most popular video plan by $1- Current Subscribers Ron-October 8
1206I think you're right about shorting NFLX. The graphics show a lot of the reaKrigannie-October 1
1205NFLX up +4% / S&P up <2%J.B.C.-September 30
1204$NFLX stock fell by -2.71% in its last trading session as supposed to -2.57% falmore100-September 30
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