The longest run for the S&P 500 Index (SNPINDEX: ^GSPC ) in nearly a decade came to a close on Monday, as the index finally fell after an eight-day run. Three S&P companies in particular caught the brunt of the damage to start the week off.
Shares in online movie streaming company Netflix (NASDAQ: NFLX ) followed the same pattern as the broader market today: Shares fell 4.4% after a stunning run-up in the stock in the past week. Granted, Netflix's rise was a little more abrupt than the market's; shares have surged more than 63% in the past five trading days alone. The company reported stunning growth in its subscriber base for the quarter, sparking a flurry of buying last week. Today's sell-off reflects some understandable profit-taking from the recent red-hot rally.
Today's second-largest decliner, defense company Lockheed Martin (NYSE: LMT ) , saw shares fall 3.3% as investors worried about a possible repeat of the hellish situation rival Boeing has gone through in the New Year. A pilot aborted a recent test run in the F-35B airplane because of issues with the propulsion system. Thankfully for Lockheed, the system is made by a unit of United Technologies. Still the 2001 Pentagon contract to provide more than 2,400 F-35s was with Lockheed, so the company does bear some responsibility. Today's sell-off drove the stock's dividend yield to a highly respectable 5%.
The last of the day's underperformers was United States Steel (NYSE: X ) , which also lost 3.3% Monday. The fall may have simply been due to a downgrade of one of its main competitors, AK Steel, by investment bank Goldman Sachs. With earnings due tomorrow before the bell, you can't blame Wall Street for getting a little spooked by the 7.4% decline in another steel giant's shares.
While the precipitous drop in Netflix shares since the summer of 2011 has caused many shareholders to lose hope, the company's first-mover status is often viewed as a competitive advantage. Yes, the opportunities in streaming media have brought some new, deep-pocketed rivals looking for their piece of a growing pie, but the recent rally shows the extent of Netflix's staying power.
Can Netflix fend off this burgeoning competition, and will its international growth aspirations really pay off? These are must-know issues for investors, which is why we've released a brand-new premium report on Netflix. Inside, you'll learn about the key opportunities and risks facing the company, as well as reasons to buy or sell the stock. We're also offering a full year of updates as key news hits, so make sure to click here and claim a copy today.