Netflix: New Strategy Fundamentally Changes Dynamics

Summary:

  • I have ended my Netflix long recommendation after almost 300% profit, as the stock now presents a balanced risk-reward profile.
  • Despite the success of paid sharing and advertising, these initiatives may hurt user engagement and Netflix’s long-term platform power.
  • Competition from Amazon’s ad-supported Prime Video and potential creator backlash pose additional risks to Netflix’s growth strategy.
  • While I see future potential in Netflix Houses, licensing opportunities, and sports, the stock is no longer the bargain it once was.

Couple in love spending their leisure time together

Riska

I am writing today to update my call on one of my best stocks, as I am now completely out of my Netflix (NASDAQ:NFLX) long position.

Author History

I have to admit, it feels a little weird to be


Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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