Sometimes it is easy to look at what is working in the stock market and assume that it is the “safe and prudent” way to invest, because it is working.  Remember that investing is about buying securities at a discount to intrinsic value based on a fundamental analysis that suggests the securities should appreciate over...Read More

This year has been wild in many terrible ways.  One extremely painful phenomenon (for a value investor) has been the massive growth outperformance relative to value.  Coming into the year, we were at the widest relative spread between growth and value since 2000.  After the pandemic tanked stocks more closely related to the economy, the...Read More

One of the hot stocks over the last few years has been Netflix.  Clearly, the product has been extremely successful across the globe, as the company has experienced strong subscriber growth.  As of July of this year, the stock was already up 40% for the year.  Despite the success of the product and the stock,...Read More

While this optimism ultimately may prove to be valid if interest rates stay this low for many years to come and if earnings continue to grow, there is also a very real chance that many market participants will get badly burned. Most of this year's stock returns for the overall market are coming from Amazon,...Read More

I feel like the below article makes some really good points about the many risks that exist when buying Netflix (NFLX) at current prices.  While I like the product and find it a reasonable value, I don’t love the business model of constantly having to acquire and renegotiate content deals, while having questionable pricing power....Read More

I’m really looking forward to seeing Facebook’s (FB) earnings on Thursday.  Everyone will be watching the company’s revenue growth to see if it continues to decelerate.  Facebook is a tremendous business but to warrant its massive market cap the company must meet exceptionally high standards.  While they certainly may be capable of doing so, as...Read More

Netflix Inc (NFLX) came out with earnings after the close and expectations seem to have disappointed.  Netflix had a strong 1st mover advantage in DVDs, but their dominance in streaming video is far from guaranteed.  Content costs are astronomical and many well financed competitors are showing a willingness to pay up for quality programming.  While...Read More

The fight between Netflix and other strong competitors in the streaming video market continues to intensify with Amazon now able to offer their films through the Sony Playstation. While Netflix did have competitive advantages in the distribution of dvd’s business, they have far less in the streaming video business.  Higher programming costs and increased competition...Read More