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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 Netflix originally filed to raise $86.3 million through Deutsche Bank in April 2000 , but the offering was withdrawn three months later as the IPO market began its long, dry period, one that still exists.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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1207Netflix raising US price for most popular video plan by $1- Current Subscribers Ron-yesterday
1206I think you're right about shorting NFLX. The graphics show a lot of the reaKrigannie-October 1
1205NFLX up +4% / S&P up <2%J.B.C.-September 30
1204$NFLX stock fell by -2.71% in its last trading session as supposed to -2.57% falmore100-September 30
1203$NFLX try shorting 100 at $101.50. Vol a bit low but small risk, small gain/lossmore100-September 28
1202$NFLX back to that critical $101.50-100.50 area. Below and we see 98/97 with 95 more100-September 28
1201September 24, 2015 - 9:00 PM EDT Netflix to Make More Shows of ISr K1September 24
1200$NFLX all about holding $97 early. If through look for $95 on the way to re-testmore100-September 24
1199Netflix research on how long it takes viewers to get 'hooked' on a show:Ron1September 23
1198Cable companies still have one big weapon against Netflix — and they are startinJakeStraw-September 22
1197That invokes a covered write strategy: Sell the January $101.43 @ $11.80 AnnJ.B.C.-September 22
1196$NFLX if we learned anything $NFLX is buy below 95 and sell above 103. easy playmore100-September 22
1195They ran a contest in 2006 offering $1,000,000 if anyone or a team could improveSr K1September 21
1194There is a post somewhere in this thread regarding their proprietary software. J.B.C.-September 21
1193We just started the How to Get Away with Murder series and it's decent, excedavid1951-September 21 K-September 21
11914:11 AM Netflix (NFLX) and ABC announced a fully global agreement making NetfliSr K-September 21
1190From a Motley Fool article (9/20 update to an earlier in the week column) about Sr K1September 20
1189Sold cash secured puts at $80 for Oct 16 on NFLX this morning. Still too conservdavid1951-September 15
1188While NFLX does have a very high PE, they did not get that high PE from a poor bdavid19512September 13
1187I've gone over my views on NFLX more than a few times on this forum - itKrigannie-September 13
1186The Netflix platform is worth something, to be sure. What I'm saying is thaKrigannie-September 12
1185 I think people still view Netflix as a luxury ... Akin to something like a pKrigannie-September 11
1184Looks like the market agrees with you.J.B.C.-September 9
1183I think fear of Apple's impact on Netflix is overdone. More than enough of tdavid1951-September 9
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