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Sure, many companies have this problem. But does Netflix? They have been making a profit for quite some time. They PE ratio is 20, which is not high compared t
by francisofascii 5y ago
Sure, many companies have this problem. But does Netflix? They have been making a profit for quite some time. They PE ratio is 20, which is not high compared to other companies. Do they need to grow to be profitable? If they can cut costs a bit and stabilize subscription levels, they should be fine. What am I missing?
- formerkrogemp 5y agoThe growth is baked into the valuation. I don't disagree with your ideas, but so much is built on perception. Share prices fall. Capital becomes more expensive. Options aren't worth as much. Employee morale drops. Profit isn't the only or main measure of success these days, which is unfortunate. As a long term shareholder, I'd be somewhat concerned about their ability to compete and deliver, but I'd be fine with their current profit levels. Not at current valuations however.