Why Buy Netflix? (NFLX)
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Why Buy Netflix? (NFLX)Considering that the stocks is down 63% on the year, why on Earth would anyone buy shares of Netflix (NFLX)? And, maybe more importantly, why would analysts still rate this stock a strong buy? The answer is that Netflix is one of the best examples of a market disruptor that we’ve seen since Apple (AAPL) released the iPhone and modernized the mobile market. Netflix delivers content in an entirely new way, and adoption rates are only going to grow.
Technologies like Netflix and the iPhone circle the globe and disrupt existing markets to such a degree that they essentially become forces unto themselves. The question isn’t whether or not Netflix will grow, it’s how fast it will grow and where it will pop up next. These so-called disruptive technologies are hot commodities for traders, and investors that get onboard early tend to really clean up for a relatively small amount upfront.
So, even though the company is down 60% on the year, it’s positioned so well for growth that all of the analysts you’re likely to talk to rate it a strong buy. It’s all about the future with disruptive technologies, moreso than with old standbys like General Motors (GM) and 3M (MMM). The reason you should buy Netflix is because it’s sweeping the globe, essentially revolutionizing television for the internet age.
It’s bigger than its IPO and market valuation, and even bigger to some extent than the current CEO and senior management. It’s all about market positioning, and Netflix is one of the best-positioned stocks to make a killing in the long run.
Published on Oct 15, 2015By Aaron Phillips