With the trade war shaking the whole market, Disney is planning to build its own streaming service by buying Fawkes assets, as well as the threat of Amazon and apple, and investors are beginning to worry about whether the online movie rental service company Netflix has reached its peak.
On Monday, Netflix's share price fell 6.5% to 384.48 dollars. This is the biggest one-day drop in its stock price in two years. As of Thursday's close, Netflix's share price rebounded to $395. However, some investors began to doubt their high valuation. Netflix shares are trading at 104 times their expected earnings next year.
An optimistic analyst like Nolen mentioned the global development of Netflix. By the end of the first quarter of this year, the number of new users of Netflix outside the United States has increased by 5 million 460 thousand, which has increased the total number of international users to 68 million 300 thousand. They believe that this is the evidence that the stock price of this media giant will grow further. In Thursday's research bulletin, nolun predicts that the number of international users of Netflix will exceed 200 million by 2023.
However, there may be some resistance to the future development of Netflix.
Netflix's competitors are launching an attack. Disney bought Fawkes to launch its streaming service in 2019. It will introduce video produced by famous film companies such as Man Wai, Lucas pictures and Disney. The company is also preparing its marketing director to promote its streaming media services.
Apple is also ready to create ambitious streaming services. It is reported that Apple's upcoming streaming media services include not only exclusive videos, but also music and magazine articles. It has just signed a multi-year cooperation agreement with the famous host Oprah, preparing to make original programs vigorously.
At an event on Monday, Apple CEO Tim Cook did not discuss its streaming service, but he spoke about the company's attitude to original content:
Another number that worries investors is Netflix's debt. In 2017, it spent $8 billion to create content. It obtains the corresponding financial support by finding bonds. In April of this year, it raised $1 billion 900 million through bonds. This is its largest financing activity to date. It is now spending billions of dollars to create content, including 80 original films and hundreds of TV shows.
Reed Hastings, chief executive of Netflix in July 2017, told investors that burning money is