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Netflix, Inc. (NFLX): Here’s How To Play It Now

Chances are, you’re among the many to have missed out on the 250% rally in Netflix, Inc. (NASDAQ:NFLX) stock over the past year. That’s OK. We can’t all be Carl Icahn.

Netflix, Inc. (NASDAQ:NFLX)

And you know what? We don’t need to be to know that the markets for filmed and televised entertainment are changing. We already stream more than 1 billion hours of programming monthly via Netflix, Inc. (NASDAQ:NFLX). YouTube, like Facebook Inc (NASDAQ:FB), serves more than 1 billion users. All signs point to a lasting shift that’s likely to benefit a variety of upstarts.

But which company is best positioned? How does Netflix, Inc. (NASDAQ:NFLX) stock compare to digital peers, Inc. (NASDAQ:AMZN)‘s Instant Video and Coinstar, Inc. (NASDAQ:CSTR)‘s  Redbox. Here’s what the number say:

Key Statistics Netflix Amazon Coinstar
Current Share Price $229.22 $278.06 $58.86
Shares Outstanding 58.4 million 455.2 million 27.4 million
Market Cap $12.5 billion $126.6 billion $1.61 billion
Trailing P/E Ratio 562.13 Not available 15.46
PEG Ratio 7.78 5.67 0.65
Gross Margin 27.5% 25.4% 31.2%
Cash From Operations (8.5 million) $4.25 billion $450.1 million

Sources: S&P Capital IQ, Yahoo! Finance.

And here’s what Fools say, going by the data available in our CAPS investor intelligence database:

CAPS Category Netflix Amazon Coinstar
CAPS Stars (out of 5) ** ** ***
No. of CAPS Ratings 9,708 6,837 740
Bullish CAPS Ratings 7,757 5,444 644
Bearish CAPS Ratings 1,951 1,393 96
Bull Ratio 79.9% 79.6% 87%

Source: Motley Fool CAPS.

Why does Coinstar get the highest rating of the three? “A single-digit EV/EBITDA and EV/FCF valuation makes this a steal,” writes Foolish investor valuemagnet. ” The decline of the DVD is not good for the core Redbox business, however, it is more detrimental to Redbox’s competitors. I see this one outperforming, potentially becoming an acquisition candidate for a private equity player once again.”

What to do now
Which of these stocks to buy has as much to do with the type of investor you are as the opportunity. Those looking for a diversified high-growth opportunity are more likely to gravitate to Amazon, which has even taken to delivering groceries. Coinstar and its lowball multiples are more likely to appeal to cheapskates such as valuemagnet.