Investors considering Netflix's
Piper Jaffray's Michael Olson raised his price target on the leading movie rental service -- from $240 to $280 -- encouraged by Netflix's opportunity to grow its popular streaming service abroad.
It was easy to be skeptical when Netflix rolled into Canada back in September.
- Would Netflix work as a streaming service with a limited digital catalog?
- Would subscribers come despite the lack of DVDs and Blu-ray discs?
- Canada has tiered broadband pricing. Would a digital smorgasbord pan out in a metered country?
The answer has been "yes" on all counts. Netflix expects to surpass a million subscribers in Canada this summer and is eyeing additional expansion markets.
Olson surveyed residents in the four countries likely to be on Netflix's shortlist: Mexico, Brazil, the United Kingdom, and Germany. A third of the respondents were familiar with Netflix with more than half of them already owning devices capable of streaming through home theaters. To be fair, Olson's survey consisted merely of 50 participants from each of the four countries. In other words, this isn't all that scientific. However, Canada's success after an initial hiccup is laying out the roadmap for expansion.
It won't be a cakewalk. Amazon.com
They better hurry, though. Netflix has a passport, and it's apparently not going to be afraid to stamp it.
Will Netflix be as successful abroad as it is closer to home? Share your thoughts in the comment box below.
Google is a Motley Fool Inside Value choice. Google is a Motley Fool Rule Breakers recommendation. Apple, Amazon.com, and Netflix are Motley Fool Stock Advisor picks. The Fool has written puts on Apple. Motley Fool Options has recommended a bull call spread position on Apple. The Fool owns shares of Apple and Google. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.
Longtime Fool contributor Rick Munarriz has been a Netflix shareholder -- and subscriber -- since 2002. Rick is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early. The Fool has a disclosure policy.