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Wednesday, May 13, 2009

Netflix

Online video rental service Netflix (NFLX) had a strong run-up after its late January breakout. It found support at its 10-week moving average twice, and rebounded to new highs. However, as often happens, on the third such pullback, the stock began to weaken.• Netflix has shown some outstanding fundamentals lately, with recent earnings and sales growth acceleration.• This is a company that's benefited from a slower economy, as more consumers have recognized the good price value of its video rental service. Netflix's streaming video service is also growing more popular.• Return on equity and cash flow per share are both strong. These are good measures of operational efficiency.• Analysts have some good earnings growth estimates for the next two fiscal years.
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