Netflix Implodes After Reporting Horrific Guidance; Notes It Repuchased Stock At $218 Avg Cost Basis

[stockholmer]

http://www.zerohedge.com/news/oops-netflix-sees-revenue-profits-4q-lower-expected

One hopes that the European surprise on Wednesday will be more successful than this. In the meantime, the XIRR on Jim Cramer's recommendation to buy NFLX on Sept 26 at $135 http://t.co/jzfKQ5K through the current AH price of $87 is -99.6%.

Earnings summary shows EPS forecast peaking at $0.70 which the street had at $1.10. Explains the epic collapse in the stock after hours.



And here is why we repeat our warning from last year, that Netflix' business model demands a follow on offering:

We expect our FCF to continue to lag net income for the next few
quarters as our spending on content continues to increase both
domestically and internationally
By pausing on further international expansion and halting buybacks, our current cash on hand is adequate to support the growth of the business. As we have done in the past, we will continue to evaluate the appropriate cash level for the business



Cramer buying at $135 on September 26, 2011 (video at link above)




http://www.google.com/finance?client=ob&q=NASDAQ:NFLX#

Netflix, Inc.
(Public, NASDAQ:NFLX)

NFLX

Close

118.84

118.84
+1.80 (1.54%)

After Hours: 85.75 -33.09 (-27.84%)

Oct 24, 7:59PM EDT
NASDAQ real-time data - Disclaimer
Currency in USD

---------------

The IRR for anyone who listened to Cramer a month ago: -99.6%




Full Release

http://www.scribd.com/doc/70136227/Investor-Letter-Q3-2011
----------------------------------


Jim Cramer is truly a dangerous man, as so many lemmings pounce on his ludicrous picks.

[KoKo]

1. I'm a subscriber of Netflix. It's cheap to me. Don't have to pay $20.00 for Tickets, Coke, Popcorn

for a remake of a remake of a remake of a movie that's crap...or to see something stupid without a plot with yucks of bathroom grafitti humor.

Love Netflix even if the CEO is an ASS who made a mess out of the split of streaming vs. DVD...then had to retract.

Netflix for those of us who don't watch the Cables stuff...is still a good deal. I can stream or rent DVD of stuff I can look forward to. But, we don't mind old ...quality...as opposed to what Red Box has that we wouldn't go out to see anyway.

Cramer is a mixed bag. If you've read about him ...you know he is bi-polar and he does take meds. (Minyanville guy who worked with him)

When he's on...he's good for some calls ...but he flubs up a lot. He's the first to say that.

Netflix isn't going to die. It's the traders who wanted it down. It will come back to maybe Jim's buy...in some time frame or not. But, I'm not giving up my subscription because we love it and many others do, also.

Netflix was pushed up into bubble territory. It wasn't worth the inflated price, like the dot com stocks back in 1999. So, it's finding it's own price after the crash.

Sorry if you got burned on it though... truly.

[stockholmer]

4. I am 90% a PM and FOREX trader, with a smattering of dividend-yielding equities. NFLX? Never, ever.

If NFLX ever gets back to Cramer's buy price, it will be when US dollars are be so debased that a 10 or 15 dollar cup of coffee will seem like a bargain. Huge trouble for all the markets by Q1, 2012. The Euro contagion needs at least 4 to 5 trillion over the next 12 to 15 months just to keep the banks afloat, so its either do the right thing (crash the zombies), which will never happen, or print to inifinity, as Bernanke has and will do.



cheers

[JDPriestly]

6. Goes to show you that having the best product and service possible

doesn't mean that your stock price should be over-hyped.

So, Stockholmer, your post does not change the fact that I and millions of Americans love to subscribe to Netflix. As for the stock, I have no idea what it is worth.

In my opinion, Jim Cramer is one of the reasons why small investors don't want anything to do with stocks right now.

[stockholmer]

8. I have no problem whatsoever with anyone using NFLX to watch movies, it sounds like a decent service

That said, in mid-July 2011 its share price was almost $300/share. Today it is around $75/share. A lot of people got their faces ripped off with this one. Amongst the largest losers (hundreds of millions) is Morgan Stanley, http://www.zerohedge.com/news/presenting-morgan-stanley-biggest-netflix-loser the huge bank that is also in a horrible FOREX derivative exposure position in regards to the EU banks. http://www.zerohedge.com/news/five-banks-account-96-250-trillion-outstanding-derivative-exposure-morgan-stanley-sitting-fx-de

This cannot help but further devastate them, and unfortunately, the US taxpayers will probably be raped for billions to bail out MS as the EU CDS nightmare plays out.


I despise Cramer for constantly cheerleading dupes into disastrous investments:



Jim Cramer: "Bear Stearns is Fine!" Tues, 3/11/08

http://www.youtube.com/watch?v=gUkbdjetlY8

CNBC's Jim Cramer screams that "Bear Stearns is fine!" and "NO! NO! NO!" ... "Bear Stearns is not in trouble" ... "Don't move your money from Bear! That's just silly! Don't be silly!" to investors while Bear Stearns was still trading at over $60 a a share, down from a high of $171 just over a year ago ( http://dealbook.blogs.nytimes.com/2008/03/14/bear-stearns-week-from-hell/ ). This just 5 days before Bear Stearns sold to JP Morgan for $2 a share, in a Fed brokered bailout.



NFLX biggest shareholders

[JDPriestly]

9. I don't watch Cramer anymore and only ever watched him because

someone in my family was interested in him.

After Jon Stewart's show on Cramer, anyone who watches Cramer is pretty foolish in my opinion.

[999998th word]

7. Left my daughter 50 cent tips, she was :-D .

She lost her job last year, still has them . 90%, and in the 99% !!

[DCKit]

5. Certainly cheaper than buying PPV movies even five times a month.

At $3.99-5.99 per "film", I'm getting damn good value from my $20/mo NetFlix account.

Argue on.

[sixmile]

2. The AH price is not down 99.6%!

Zerohedge needs an editor.

[stockholmer]

3. read more closely, and look at the chart, it is the IRR that is down 99%, not the price

IRR is Internal Rate of Return. I take it you do not do much trading? IRR is the value lost or gained over a period of duration.