Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, movie rental service Netflix (Nasdaq: NFLX ) has received a distressing two-star ranking.
With that in mind, let's take a closer look at Netflix's business and see what CAPS investors are saying about the stock right now.
Netflix facts
| Headquarters (founded) | Los Gatos, Calif. (1997) |
| Market Cap | $3.6 billion |
| Industry | Internet retail |
| Trailing-12-Month Revenue | $3.4 billion |
| Management | Founder/Chairman/CEO Reed Hastings CFO David Wells |
| Return on Equity (average, past 3 years) | 58.3% |
| Cash/Debt | $804.5 million / $400.0 million |
| Competitors | Amazon.com Blockbuster Coinstar |
Sources: S&P Capital IQ and Motley Fool CAPS.
On CAPS, 19% of the 9,528 members who have rated Netflix believe the stock will underperform the S&P 500 going forward.
A few months ago, one of those Fools, Becker2011, touched on the competitive headwinds working against Netflix:
In this game it is all about content, which boils down to who has more cash to buy it. Amazon ... signed a deal with Viacom adding Comedy Central and MTV to what they have to offer. As Amazon slowly enters this space [Netflix] is going to have more and more problems competing and retaining customers. Also, not to mention Coinstar's [Redbox] can't be helping either.
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