Based on the aggregated intelligence of 130,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, online DVD rental service Netflix (NASDAQ:NFLX) has received a distressing two-star ranking.

With that in mind, let's take a closer look at Netflix's business, and see what CAPS investors are saying about the stock right now.

Netflix facts

Headquarters (founded)

Los Gatos, Calif. (1997)

Market Cap

$2.24 billion


Internet retail

TTM Revenue

$1.43 billion


Founder/CEO Reed Hastings

CFO W. Barry McCarthy Jr.

Price-to-Earnings Ratio (NFLX and S&P500)

25.9 and 16.7


Blockbuster (NYSE:BBI)


CAPS members bearish on NFLX also bearish on

General Motors (NYSE:GM)

Ford (NYSE:F)

CAPS members bullish on NFLX also bullish on


Johnson & Johnson (NYSE:JNJ)

Sources: Capital IQ (a division of Standard & Poor's) and Motley Fool CAPS. TTM = trailing 12 months.

Over on CAPS, 1,177 of the 6,980 members who have rated Netflix -- or 17% -- believe the stock will underperform the S&P 500 going forward. These bears include my Foolish colleague Tim Hanson (TMFMmbop) and PeakStocks, both of whom are ranked in the top 15% our community.

Late last month, Tim wrote that the bear case all boiled down to price: "Outlandishly expensive. DVD business worth about $25 to $30 per share. At any price higher than that, you're hoping Netflix figures out how to do something they don't even do yet and make it worth $1 billion."

In a pitch from two weeks ago, PeakStocks also recommends that Fools walk out on Netflix:

Valuation is through the roof, competition is higher and the sustainable competitive advantage is in question due to the studios banding together to create their own real time streaming services, such as Hulu, etc. ... My bet is that as the economy recovers, stocks that were looked at as a safe haven and that did well, are going to be exited as folks rotate into other stocks that are ripe for a rebound and offer a more compelling valuation and deeper value investing thesis going forward.

[Netflix] does not fall into this category, and its best days may very well be behind it.

What do you think about Netflix, or any other stock for that matter? Make your voice heard on Motley Fool CAPS today. More than 130,000 investors are waiting to hear what you have to say. CAPS is 100% free, so simply click here to get started.

Fool contributor Brian Pacampara owns no position in any of the companies mentioned. Netflix and Apple are Motley Fool Stock Advisor picks. Johnson & Johnson is an Income Investor selection. Google is a Rule Breakers pick. The Fool's disclosure policy always gets a perfect score.