|Operations||Netflix turned the movie-rental industry upside down with its rentals-by-mail model, and it's doing it again with streaming digital movies.|
|Market Cap||$11 billion|
|Trailing P/E Ratio||79.5|
|Return on Equity, Past 12 Months||65.7%|
Data from Yahoo! Finance and from Capital IQ, a division of Standard & Poors.
When we looked at Netflix as a core stock for your portfolio back in September, it was a somewhat dividing pick. Some investors didn't like the P/E ratio sitting north of 57 times trailing earnings, and others questioned how many subscribers could be interested in a supposedly low-quality catalog of streaming titles. Fellow Fool Anand Chokkavelu even posits that Netflix should be high on your sell list in 2011.
Yet here we are, four months and not one but two blowout earnings reports later, and Netflix looks more expensive than ever -- and just as promising. CEO Reed Hastings engaged in a much-publicized exchange of salvos with famed superinvestor Whitney Tilson over the wisdom in shorting the stock, and Hastings has so far been proved right.
The big question for Netflix is not how quickly Coinstar
It probably irks Time Warner
Netflix has proved many times over that its streaming-media model works, and it will continue to do so in the coming quarters and years. It's fine if you're a skeptic, but I would still advise against selling Netflix short -- it tends to be bad for your portfolio's health.
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Fool contributor Anders Bylund owns shares of Netflix but holds no other position in any of the companies discussed here. Netflix is a Motley Fool Stock Advisor selection. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. You can check out Anders' holdings and a concise bio if you like, and The Motley Fool is investors writing for investors.