Can it really be National Boss Day -- already? No offense, Mr. Springsteen, but this has to be the lamest holiday we've ever had thrust upon us. Mind you, that's just between us -- as far as you know, we honestly tried to find a card. I guess even Hallmark's entitled to a mistake, but National Boss Day?

Kind of makes one long for those brutal grade-school Valentine's Day card-swapping debacles, doesn't it?

In today's Motley Fool Take:

Netflix Wins One More

On the surface, Netflix(Nasdaq: NFLX) looks like the underdog in a Blockbuster(NYSE: BBI) world. But when all is said and done, you get the feeling that Netflix might just have what it takes to get to the big show.

Yesterday afternoon, the online mail-service DVD rental company reported a 77% year-over-year jump in third-quarter revenues to $72.2 million, showing a GAAP profit of $3.3 million or $0.10 per diluted share. Meanwhile, cash flow from operations almost doubled to $22 million.

But several other things stand out. First, the cost of growth is dropping. Second, the benefits of Netflix's online model are starting to show up in the margins. And most importantly, there is plenty of free cash flow.

As highlighted two weeks ago, Netflix's subscribers jumped 13% sequentially to 1.29 million. Just as importantly, the churn rate -- or subscriber loss -- fell to 5.2% in the quarter from 7.2% in last year's quarter. On top of that, the acquisition cost of those new subscribers fell from $33.57 to $31.81 over the same period.

And while gross margins are still low compared to brick-and-mortar rental joints, Netflix's net margins actually run higher. As gross margins improved to 46.5%, net margins came in at 4.6% -- better than Blockbuster, and comparable to Hollywood Entertainment(Nasdaq: HLYW). But excluding stock-based expense, Netflix showed a net margin of 8.4%.

Free cash flow, in its eighth consecutive positive quarter, also grew 36% to $7.9 million, for a healthy 11% margin.

Not too long ago, there were a bunch of Netflix skeptics. In the face of competition from Wal-Mart(NYSE: WMT) and Blockbuster as well as a perceived future threat from Amazon(Nasdaq: AMZN), I'm sure there still are.

But since Rick Aristotle Munarriz profiled the company in the November 2002 TMF Select (now Motley Fool Hidden Gems) at $10.90 per share, the stock has just about quintupled. Since David Gardner picked it in Motley Fool Stock Advisor in June, Netflix is up, oh, 150% or so. And since Netflix reported earnings yesterday, the stock is up 17% to over $52 a share.

Fully diluted, Netflix boasts a $1.6 billion market cap, or about 70 times its $22.3 million in trailing free cash flow. The stock's value is up for debate, but with Netflix's spectacular growth, solid cash flows, nifty brand, and cult following, there is at least one less skeptic today.

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What's Altria Smokin'?

Tobacco and food multinational Altria Group(NYSE: MO) reported positive news today from its tobacco operations but less so from its 85% ownership of Kraft(NYSE: KFT).

Overall, Altria earned $1.22 per share in Q3, down 43% from last year but almost even if you take away the one-time gain of $0.81 from selling part of Miller Brewing.

Altria's execs referred to the Kraft earnings as "challenging" (not good) and left details of that company to its own reporting. We follow suit, referring you to Alyce Lomax's Kraft coverage today. The company also left litigation -- a major risk -- out of the earnings press release and conference call.

Altria said that while its quarterly revenues increased 4.7% to $20.9 billion, this came primarily from $940 million from the dollar's appreciation against the euro and other currencies. Net income declined 43% against last year's quarter, which was boosted by the Miller Brewing proceeds. Altria sees full-year 2003 EPS at $4.50 to $4.60, giving the stock today a forward P/E of about 10.

Altria's Philip Morris USA and Philip Morris International (PMI) units concentrate on four focus brands: Marlboro, Parliament, Virginia Slims, and Basic brands. Though cut-rate generic competition has threatened premium brand sales, volumes were off only 1% in the U.S. and up 0.8% in Western Europe. Nevertheless, the Marlboro brand gained market share worldwide. It was noted on the conference call that in some countries -- especially Italy -- the legal and contraband competition threatens government ad valorem (based on the selling price) excise taxes, leading to the curious anomaly that protecting Philip Morris protects its own revenues.

Balancing flat U.S. and Western European volumes are a 9% increase for Eastern Europe, the Middle East, and Africa, and over 3% for Asia.

Investors are happy with any sales and profit growth, because many buy Altria stock in large part for the dividend -- $2.72 a share, for a 6% yield (check out our Income Investor newsletter for more stocks that pay). And that yield hasn't changed.

The news barely moved the stock, slightly off yesterday's $45.15 close in mid-day trading.

Quote of Note

"The secret of success is to know something nobody else knows." -- Aristotle Onassis.

Online Bull Is Back

For relief over the market's recent gains, few can match the online discount brokers. After all, they've spent the last dozen years educating consumers on the merits of trading over the Web: the convenience, the self-empowering rush, and, of course, the savings.

Everything was falling into place when the bottom fell out of the market. Then, faster than you could say "chimp to chump," the online discounters, including E*Trade(NYSE: ET), Schwab(NYSE: SCH), and Ameritrade(Nasdaq: AMTD), fell flat.

Turns out, all the benefits of online trading meant little if folks just weren't interested in the stock market. Amazing what a few months of Wall Street gains will do to win back a crowd, huh?

Last night E*Trade reported strong third-quarter earnings on a 21% spike in revenue. On an average day the company processed 131,525 commissioned trades. That's a 49% improvement from last year.

Back in February, we argued that one shouldn't discount the discount brokers. While E*Trade originally guided analysts to earnings this year between $0.22 and $0.27 a share, last night it revised those targets. E*Trade is now looking for its 2003 profit to come in between $0.40 and $0.48 a share.

Looks like the online brokers are back. Maybe the time is right to check out our Broker Comparison Table to see if your stockbroker is up to snuff.

Discussion Board of the Day: Discount Brokers

Happy with your broker? Not so happy? How do your fees and services stack up? Any new entries or established names that you would like to run past your fellow Fools? All this and more -- in the Discount Brokers discussion board. Only on Fool.com.

Mo r e Fool News

For all today's stories, see Today's Headlines.

And Finally...

It was the best of trades and the worst of trades -- we think you know where we're going with this. That's right, it's our own pizza fan Jeff Fischer, and he's got a Tale of Two Shorts. Just make sure that you have more "best of times" than "worst of times." For a head start, check out Selena's Maranjian's 10 Shocking Stats. We'd tell you why, but you've obviously clicked away to read Selena's story. You know you did. But then, who could resist -- the title has a number in it, doesn't it?

Contributors:
Bob Bobala, Robert Brokamp, Paul Elliott, Mathew Emmert, Jeff Fischer, Jeff Hwang, Tom Jacobs, LouAnn Lofton, Alyce Lomax, Bill Mann, Selena Maranjian, Dave Marino-Nachison, Rex Moore, Rick Munarriz, Reggie Santiago, Dayana Yochim