Netflix, Inc. (NFLX) Earnings Should Soar, but Will They Grow Enough?

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Most recently, Netflix shares soared on news that competitor Hulu changed its original plans to sell itself. Instead, The Walt Disney Company (NYSE:DIS) and its partners in Hulu will make new investments to boost its prospects. But for Netflix, a Hulu sale would potentially have changed the status quo much more dramatically, and so investors appear to have concluded that even a Hulu with somewhat more financial resources represents less than a threat than a Hulu under new ownership.

In the Netflix earnings report, watch closely for news about how well the company is doing drawing subscribers both domestically and internationally. Growth in foreign markets is the real key to keeping Netflix’s growth rate high enough to justify what has now become a premium valuation; but with the right efforts and attention, Netflix could well pull it off over the long run.

The article Netflix Earnings Should Soar, but Will They Grow Enough? originally appeared on Fool.com is written by Dan Caplinger.

Fool contributor Dan Caplinger has no position in any stocks mentioned. You can follow him on Twitter @DanCaplinger. The Motley Fool recommends Amazon.com, DreamWorks Animation, Netflix, and Walt Disney. The Motley Fool owns shares of Amazon.com, Netflix, and Walt Disney.

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