Even though Netflix's
If you don't know about Netflix and its all-you-can-rent, monthly fee-based DVD rental plan, don't come here. Hang out by the water cooler at work. Eavesdrop on your neighbor's whoop of delight as he pulls his latest Netflix envelope from the mailbox.
By year's end, Netflix expects to be serving at least 4 million movie buffs. In the near term, a price war against Blockbuster
With churn at a record low (meaning that the company is keeping more of its customers) and subscriber count at a record high, how can you not like Netflix?
It gets better, though. Netflix has spent the past few years building out a network of dozens of distribution centers to assure that most of the country can receive next-day disc delivery for the price of regular postage. Wal-Mart
Netflix has grown at a heady clip despite a slowdown in DVD sales this year, dipping multiplex attendance for the past three years, and a downturn in the shares of many retailers. Is waning disposable income a threat to Netflix, or is Netflix part of the reason why money has been scarce elsewhere? The company has become an indispensable part of the lives of its millions of members. They rate movies, share picks with virtual friends, and receive recommendations based on their viewing preferences.
Netflix has become the movie critic that truly gets you and the rental chain that won't stiff you with costs or burden you with repeated trips to the store. I have been a subscriber -- and a shareholder -- for three years now, and I've been rewarded for both experiences. Readers of Motley Fool Stock Advisor have also been treated to some spectacular gains; Netflix has been recommended on three different occasions since 2003, each time with substantial returns. (Amazon.com is also a recommendation in the newsletter.)
The future looks bright, too. Advertising initiatives, new markets, and the potential to apply the established ring of network centers to distribute everything from video games to music to software will keep the stock going well beyond its first 4 million diehard fans.
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Longtime Fool contributor Rick Munarriz has been a Netflix subscriber -- and investor -- since 2002. The Fool has a disclosure policy. He is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early.