Corporate earnings will most likely be hurt by lower-priced competitors enticing customers to switch away from Netflix.
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New York, NY (PRWEB) March 09, 2012
News that cable giant Comcast Corporation is entering the online streaming market might be the beginning of the end for Netflix Inc., according to Sasha Cekerevac, contributor to popular financial newsletter Profit Confidential. In his recent article, Is this the End for Netflix?, Cekerevac highlights that, with Comcast offering its existing customers a much lower rate than the Netflix product, this will hurt corporate earnings for Netflix, possibly to the point of causing the firm severe problems.
“I think there might be a significant hit to the corporate earnings of Netflix if many of its clients decide that a bundled cable package of current TV and an online database of streaming movies that’s either free or only $4.99 a month might entice many customers,” says Cekerevac.
Cekerevac also highlights that Comcast is not the only firm Netflix has to fight for its corporate earnings. “Amazon is continuing to sign deals with Hollywood companies for its streaming service,” says Cekerevac. “Amazon is a giant that relies on slim corporate earnings, which can only hurt the future earnings outlook for Netflix.”
“Management needs to differentiate Netflix from the crowd, or try to sell the firm to a larger company like Apple Inc. or Google Inc.,” says Cekerevac.
While Netflix still has a fighting chance to survive, Cekerevac believes it will be a very tough road over the next several years, as the earnings outlook remains very murky.
“Corporate earnings will most likely be hurt by lower-priced competitors enticing customers to switch away from Netflix,” says Cekerevac.
Profit Confidential, which has been published for over a decade now, has been widely recognized as predicting five major economic events over the past 10 years. In 2002, Profit Confidential started advising its readers to buy gold-related investments when gold traded under $300 an ounce. In 2006, it “begged” its readers to get out of the housing market... before it plunged.
Profit Confidential was among the first (back in late 2006) to predict that the U.S. economy would be in a recession by late 2007. The daily e-letter correctly predicted the crash in the stock market of 2008 and early 2009. And Profit Confidential turned bullish on stocks in March of 2009 and rode the bear market rally from a Dow Jones Industrial Average of 6,440 on March 9, 2009, to 12,876 on May 2, 2011, a gain of 99%.
To see the full article and to learn more about Profit Confidential, visit http://www.profitconfidential.com.
Profit Confidential is Lombardi Publishing Corporation’s free daily investment e-letter. Written by financial gurus with over 100 years of combined investing experience, Profit Confidential analyzes and comments on the actions of the stock market, precious metals, interest rates, real estate, and the economy. Lombardi Publishing Corporation, founded in 1986, now with over one million customers in 141 countries, is one of the largest consumer information publishers in the world. For more on Lombardi, and to get the popular Profit Confidential e-letter sent to you daily, visit http://www.profitconfidential.com.
Michael Lombardi, MBA, the lead Profit Confidential editorial contributor, has just released his most recent update of Critical Warning Number Six, a breakthrough video with Lombardi’s current predictions for the U.S. economy, stock market, U.S. dollar, euro, interest rates and inflation. To see the video, visit http://www.profitconfidential.com/critical-warning-number-six.