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Netflix (NASDAQ:NFLX) shares jumped over 14% on Thursday after the company's CEO, Reed Hastings, reported that monthly viewing for its streaming services exceeded one-billion hours for the month of June, the first time this has ever occurred. As a result, investors are buying shares of NFLX, believing that the demand for the company's services is increasing and that the company could be making a rebound. However, is NFLX presenting value for the long-term investor? And what are the risks and rewards involved with investing in NFLX?

I guess the biggest question for the immediate future is whether or not an increase in streaming equals more profit for the company. The problems for this company haven't really been its sales, as it posted 21% revenue during its last quarter's flop, which is by most measures considered a success. The major problem for NFLX is margins, and now profit. When the company tried to correct the problem, its stock plummeted, and consumers did not take kindly to its business being split or the price increase for its services.

A rise in streaming hours does signal growth, perhaps more growth than analysts expect. Last quarter the company only had two billion hours of streaming, but now it's announcing one billion for one month. Yet, we don't know how much extra NFLX spent on marketing, advertising, and promotions to earn those additional hours. We don't know how the mail order program is performing or if per subscriber streaming is increasing, or if the added hours are from new subscribers.

At this point there are several questions that still remain for one of the most controversial stocks in the market. The company is now pushing its services in an aggressive marketing strategy oversees. This has been very controversial over the last few weeks, as there are concerns of increased costs, a lack of regions that can support streaming services, and that it could be several years before seeing a profit. However, if other countries strive to support high speed broadband and spend the money to develop networks, then it is possible that NFLX could become a global company. At this point, NFLX is most likely close to maxing out its presence in the U.S. with increased competition from Redbox and other streaming services expected to launch in the coming years.

As an investor I believe NFLX is a wait and see stock. It has a forward P/E ratio of 38.53, but does have strong sales compared to its market capitalization. It has a healthy balance sheet and the ability to expand, but with the expansion plan that it's executing, investors should expect low margins, most certainly lower than its current 4.81% profit margin, for at least another two years. Therefore, it must counter low margins with faster sales growth, which I believe will be difficult as a result of its global approach. I think the fact that streaming hours are increasing is always a positive for a company such as NFLX, but investors must remember all the many questions that are yet to be answered, and if the volatility of this stock is worth the risk.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.