Friday, October 3, 2014

Seeking a Cornerstone

Wanted: Investment manager seeks fun loving stock that can continuously travel to new heights, no matter what. This stock must be able to overcome market corrections from political turmoil.  It also needs to gracefully shrug off any general economic worries. This stock must love to frustrate all of its doubters and maintain an unwavering sunny disposition despite all circumstances. If any possible disappointment should happen, this stock must be able to recover quickly so that no one will remember why it went down in the first place. If you are a candidate for this request, please make yourself known in a clear and concise manner.

The flattish stock market that we are experiencing seems tethered to the dock. After a sell off early in October, the S&P 500 was only up 6% for the year and the DOW was virtually unchanged. The market makes very little progress in either direction.

In order for portfolios to grow, it is imperative that investors dig out and discover standout performers. This might imply singling out small companies that can grow to magnificent proportions from relative obscurity.

Or, as is more often the case, an enterprise that is already a juggernaut simply runs away from the field and catapults itself to new heights by generating more rapid growth than anyone expects.

Such is the case at Netflix which has been the market’s number one stock over the past two years for all stocks at a relevant market capitalization. In spite of this gain, Netflix may be just scratching the surface of its potential.

Netflix is known primarily for streaming movies made by other companies. It has shaken up the TV world by offering original television content  like smash hits “Orange is the New Black” and “House of Cards”.

Most recently, Netflix has announced a foray into making its own original movies. A sequel to “Crouching Tiger, Hidden Dragon” will be a Netflix property. In addition, Netflix has signed Adam Sandler to make four feature films. Netflix’s plans include a suite of pay per view offerings at $5.99 that would be a significant increment to its $7.99 monthly service.

Netflix reached 490 per share in September before succumbing to profit taking. It dropped as low as 437 this month before recovering slightly.

In the months ahead, this company should regain its royal state as investors become more convinced about its bright prospects. Netflix should be a cornerstone for our investment portfolios and we plan to buy these shares this quarter.


1 comment:

  1. This stock must be able to overcome market corrections from political turmoil. It also needs to gracefully shrug off any general economic worries. it asset disposition services in india

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