This is going to be a big month for Netflix (NASDAQ:NFLX) investors. They just might not know it yet. Shares of the leading premium streaming video service have had a wild 2014.
The stock that was the biggest percentage gainer in 2013 among S&P 500 companies has been a laggard in 2014. Netflix stock is trading 5.9% lower through the first 11 months of the year, turning negative after posting disappointing quarterly results in late October. There's still one month left to turn Netflix's fortunes around in 2014, and December has a lot of interesting catalysts that could eventually lead to renewed interest in Netflix. Let's take a closer look at a few of the dates worth watching.
Netflix will present at next week's UBS 42nd Annual Global Media and Communications Conference. These investing conferences don't typically move the stocks of companies as large as Netflix, but after October's post-earnings meltdown -- the stock has shed nearly 30% of its value since its late summertime peak -- you can be sure that any kind of welcome or unwelcome news will move the shares.
Guardians of the Galaxy comes out on DVD next week. This is important as it's the country's highest-grossing film of 2014, raking in $331.9 million in domestic ticket sales, according to Box Office Mojo.
This is a pretty big deal at a time when DVD subscriptions continue to decline sequentially. Netflix has deals in place with some studios to delay DVD and Blu-ray availability, but this isn't one of them. It can be rented through Netflix on the same day that it's available for retail purchase, and that can only help at a time when Netflix's cash cow business has been fading.
The big Netflix original series premiering this month is Marco Polo. The Weinstein brothers originally had a deal with Starz to back this tale of the early years of Marco Polo in the court of Kublai Khan, but Netflix stepped up when the Starz pact fell apart.
There's a lot of money tied into the show that could be Netflix's closest match to HBO's Game of Thrones. Reports claim that all 10 episodes of the first season cost roughly $90 million to produce. The show is billed as featuring martial arts, sexual intrigue, political skullduggery, and epic battles. Let's see if it satisfies Game of Thrones buffs.
Netflix's partnership with DreamWorks Animation (NASDAQ:DWA) hasn't exactly moved the needle so far. The deal for the computer-animation studio to develop 300 hours of exclusive programming based on DreamWorks Animation characters got off to a rough start late last year with its Turbo FAST series. Based on the Turbo movie featuring a snail bestowed with the power of speed, it's probably not a surprise that the series hasn't generated a lot of buzz. The original full-length feature was a box office dud two summers ago.
Things may heat up later this month when All Hail King Julien begins streaming. The series is based on the whimsical lemur king from the Madagascar movies. That franchise has proven far more successful than Turbo, and it's perfect timing that the Netflix exclusive series debuts just three weeks after the latest installment in the Madagascar franchise hits theaters.
Just as it did with Turbo FAST, it's only going to make a handful of episodes available at a time. The first five of the 22-minute episodes will be available on Dec. 19. It should be more receptive for young families, making Netflix that much more stickier.
Netflix fell short of its net subscriber forecast during the third quarter, and all eyes will be on how the fourth quarter plays out relative to the former dot-com darling's guidance. If Netflix blows back-to-back outlooks its vision will be rightfully questioned and deemed unreliable in the near term.
Netflix expects to close out the year with 57.06 million total streaming subscribers worldwide, a 4 million uptick from where it was at the end of September. It was targeting 3.69 million net additions during the third quarter, only to fall short by gaining only 3.02 million total members during the months of July, August, and September.
Netflix went on to blame the May price hike for new streaming accounts and an unexpected drop-off in signups after the buzz behind the second season of Orange is the New Black faded. It can't afford to be overly aggressive again. We won't know the actual tally of new members until several weeks into January, barring an early January press release, but Dec. 31 is a date that will be huge in retrospect.
Rick Munarriz owns shares of Netflix. The Motley Fool recommends DreamWorks Animation and Netflix. The Motley Fool owns shares of Netflix. 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. The Motley Fool has a disclosure policy.
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