Citron is aimed at Netflix Inc, and the stock price can be shorted to US $300.
Andrew Left, founder of Citron Research, pointed the finger at Netflix Inc, the hottest technology stock. "what happened to Netflix Inc is incomprehensible," Andrew Left said on Twitter on Monday. "the market capitalization increased by $17 billion last week, the short position is at a 10-year low, but content spending is not sustainable in the long run, and Netflix Inc's share price can be shorted to $300."
Source: Citron
At the same time, Andrew Left said, "Netflix Inc's financially strong competitors will hire the same producers and create competitive content, and because of this, Netflix Inc does not have a moat like Amazon.Com Inc or a moat like Alphabet Inc-CL C." "
As a result, Netflix Inc closed down 3.06 per cent at $321.3 on Monday, about 7 per cent away from $300.
Source: Futu Securities
It is worth noting that Netflix Inc has risen 67.38% so far this year, making him the leader in the S & P 500.
Source: Bloomberg
Burn money, burn money, or burn money
Financial blog Zerohedge pointed out that Netflix Inc's "unsustainable" content expenditure is a very familiar topic, not news. Judging by both operating cash flow and free cash flow, the company has been burning cash for years.Netflix Inc found $500m in financing every quarter in 2017 to support content development. Netflix Inc said in January 2018 that he planned to spend between $7.5 billion and $8 billion on content this year.
In addition to the urgent need for funds for content creation, Netflix Inc's expenditure on marketing has also soared.In 2018, Netflix Inc (Netflix) announced plans to increase marketing spending to $2 billion this year from $1.3 billion last year, a decision that scared investors into a cold sweat.
Netflix Inc's increased marketing expenditure budget is mainly spent on two types of markets-mature markets and emerging international markets. In the report, Netflix Inc compares the marketing expenditure of the two types of markets:
Domestic | International | |
|---|---|---|
Marketing expenditure | $5533, 000000 | $7247000000 |
New number of users | 49000000 | 166000000 |
Average new user marketing expenditure | $112.92 | $43.66 |
Source: a letter from Netflix Inc to shareholders in the fourth quarter
Analysts at Barclays said that as long as Netflix Inc had the ambition to gain a foothold in the international market, he must first be willing to spend money on advertising, and in the later stage, Netflix Inc would need more money to promote original content in the international market like the local market.
The continuous financing makes Netflix Inc's debt increase year by year.
Source: Zerohedge
In addition, Netflix Inc seems to be taking the strategy of not considering the cost to gain market share, so Netflix Inc's capital demand is obviously much greater than that of his peers. It is worth considering whether this model can be sustained in the context of interest rate hikes in the United States.
Source: Zerohedge
Netflix Inc still has loyal supporters.
However, Netflix Inc still has many supporters, GBH Insights's Daniel Ives told customers on Friday, "We think Netflix Inc still has the unique power to let its content and sales tentacles grow in the next 12 to 18 months, and further build its large-scale content and streaming layout. He reiterated his evaluation of Netflix Inc's stock as "highly attractive".
The Motley Fool analysts believe that the video resources provided by Netflix Inc are not its core value. Big data is the king. Netflix Inc collects data on users' viewing habits, such as viewing records and viewing hours, as well as their viewing preferences, including content and length of stay, etc., these valuable data will be the ultimate weapon for Netflix Inc to easily defeat traditional media in the future.