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Nick Gagnon

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  • A Believer In Netflix... It's Not Too Late [View article]
    I might have to contact the CFAI to check the status of your credentials, that was a very weak article; non-existent financial analysis and insufficient editing.

    I think part of the reason TWT separated their segments in reporting, was to demonstrate the lack of a viable business model NFLX is engaged in. A middle man, with nothing proprietary that has already reaped the easy growth. We'll continue to see an increase in the declining rate of subs, and with increasing stiffer competition.
    Mar 2 09:31 AM | 3 Likes Like |Link to Comment
  • Bullish On Netflix At $450? [View article]
    C'mon you can't say something like this as a contributor on SA! The entire financial markets are based on assumptions, we're not discussing tangible assets like land, cattle, rare comics, etc. You have to expect a certain level of backlash when you include stuff like 'probabilities I've calculated' with no background information whatsoever.
    Feb 27 09:38 PM | 1 Like Like |Link to Comment
  • Bullish On Netflix At $450? [View article]
    Sorry I meant to say 'independent', not dependent, and they're mutually-exclusive. But that is basing a probability on a single event, and this is not (it's a continuum of events).

    I just don't understand how you would not recommend shorting a stock if there's positive expectancy involved (according to your probabilities)?! I'm really trying to understand the point of this article Michael.
    Feb 27 09:35 PM | Likes Like |Link to Comment
  • Bullish On Netflix At $450? [View article]
    Where in the world do you come up with the thesis it could be 'one of the most profitable' companies out there given their history of negative FCFE? Apple is profitable, Exxon-Mobile is profitable, Netflix is not.

    I'm also trying to understand how you derived those probabilities. I know if they were based on a static date the stock price can't be both $350 and $400 at the same time, so those are dependent variables. In other words, all those probabilities need to add up to 100% for all total scenarios. Let's assume you chose $450 (approximate current price), and 0$, which is the sum of all prices where it could fall. We're not factoring in buys on higher prices here (your argument is investing on dips). All prices from .01 - 450 need to add up to 100% sum of probabilities.

    You chose levels of $200-400 at somepoint in the future, can you elaborate on the math? I welcome someone here with a much stronger statistical background than me to comment on it.

    Lastly, since you feel compelled to buy at these levels (given your long-term bullish argument), why not write some puts at those strike levels?
    Feb 27 01:02 PM | 2 Likes Like |Link to Comment
  • Netflix Is A House Of Cards On The Verge Of Collapse [View article]
    It wasn't 'fretting' Gary, it was a 'non event'. Which is exactly what NFLX is (and the weight of most of your comments) lacking significance. NFLX is just a middleman, and sooner or later it's capacity will be absorbed.
    Feb 26 07:53 AM | Likes Like |Link to Comment
  • Netflix Is A House Of Cards On The Verge Of Collapse [View article]
    I'm not familiar with it, and to be honest I've never liked amazon's site! I've used ebay a lot in the past and thought it was a significantly better experience than amazon for buying/selling. I also think AMZN's valuations are absurd, but considering the growth of this company in different segments, and inter-twining these services I wouldn't short the stock. And back to my comments regarding lack of liquidity, when the same type of engine does not produce the same market reaction (e.g. NFLX and AMZN licensing deals), you know something is off with the tape. The trading statistics speak for themselves, and when the institutions sell (they will at some point!), watch-out below.
    Feb 26 07:49 AM | Likes Like |Link to Comment
  • Netflix Is A House Of Cards On The Verge Of Collapse [View article]
    Well, we'll see about that. There's another point I want to dismiss that's common among bulls, just because NFLX is cheap doesn't mean someone will want it! My girlfriend is in the last year of residency, she'll be making 300k next year. She's a casual user of NFLX and even at $8 a month, she's on the fence about keeping it. I'll tell you what could make her drop it; however, AMZN. She loves the bundled service of shipping discounts, and the wide variety of e-books with her kindle. She barely uses Prime, but the other products make up for any weakness the service Prime has, and if it starts gaining more popularity as it steals programming away from NFLX, it will be an easy decision to drop. Just because something is cheap, doesn't mean people will buy it!
    Feb 25 10:39 PM | 1 Like Like |Link to Comment
  • Netflix Is A House Of Cards On The Verge Of Collapse [View article]
    I think the point is that the stock could plummet quite easily (like all bubble stocks).

    I traded the Ag Chems nearly exclusively for many years. I enjoyed the sector a lot, I understood the business models and did well trading them. I watched POT, AGU, MOS, CF, all these guys go on an absolute tear, something like 600% in a year. At the time potash/tonnage was up to I believe 1k for a short ton, and the earnings were nothing short of spectacular. If you think NFLX 'crushes' earnings when it beats by 20%, go check and see the EPS history of some of these companies. They were beating by 100-275%, it was insane! The market loved these guys, and the meteoric rise was more than reasonable. Flash forward 2008, the commodity bubble popped, and these stocks (like the rest of the basic material sector) never fully recovered.

    I still remember to this day, my colleague mentioning to us how a woman in his building had asked his advice on her investment of 50k shares of POT when it was over $200. She was never in the money on that position, and if you told me back then the stock would crumble to where it is today, I'd say probably the same thing you're telling people right now.
    Feb 25 07:27 PM | Likes Like |Link to Comment
  • Netflix Is A House Of Cards On The Verge Of Collapse [View article]
    I've been told by several people that they share NFLX passwords. You can take all the personal shots you want, but you're arguing on theoreticals. My social circle is diverse but all are well-established working professionals, and the 'ease' of piracy is what makes it convenient. You can take all the personal shots you want, but just because someone has the means to pay for something doesn't mean that they will. Nice try.
    Feb 25 06:54 PM | 1 Like Like |Link to Comment
  • Netflix Is A House Of Cards On The Verge Of Collapse [View article]
    I would be interested in hearing about these option strategies. :)
    Feb 25 08:30 AM | Likes Like |Link to Comment
  • Netflix Is A House Of Cards On The Verge Of Collapse [View article]
    Well as a contributor, he's earning income from these articles. And your participation is assisting in that (as well as driving interest to his company/fund).

    I would like to point out that retail investors, those who represent the majority of trading losses in the markets, benefit from the criticism of stocks brutally overvalued. I don't care what you say Gary, there is no way to be profitable investing long-term 'buy and hold' on companies with 100X plus FCF, and negative FCFE.
    Feb 25 08:29 AM | 1 Like Like |Link to Comment
  • Netflix Is A House Of Cards On The Verge Of Collapse [View article]
    It's highly unlikely a collapse won't happen until there's institutional selling. When that is, could be anyone's guess. I work in a trading division for a large institution, and the Seg Targs (tactical allocation for segregated securities) can happen at anytime. I would expect any money-manager has out-performance metrics for the holdings representing the underlying units in the fund, and at some point when something is greater than several standard deviations in returns, expect to lock in some gains. The selling could be exasperated if these large funds sell-off in tandem, there would be very little liquidity to absorb that pressure.
    Feb 24 09:03 PM | 1 Like Like |Link to Comment
  • Netflix Is A House Of Cards On The Verge Of Collapse [View article]
    Hey Gary, believe it or not it's possible to make money on a position that's moving against you. I had a spread go against me for 7 days straight as it was breaking stan. deviations off it's 50 MA, and was still profitable over-all on it during that period. Then the spread reversed, and I was rolling legs like no tomorrow. Your analogy of a battle couldn't be much more short-sighted. P.S still waiting for that drawing. :)
    Feb 24 07:44 PM | 1 Like Like |Link to Comment
  • Netflix Is A House Of Cards On The Verge Of Collapse [View article]
    I seriously doubt that Biobat. The college-age and working professionals which grew up through napster, torrents, etc. will share passwords. I don't know how old you are (this is a genuine comment, not meant to be snide) but the older generations don't understand how younger generations respond to internet services. The norm is to find something cheap, and in the anonymity of the internet, they don't see anything wrong or immoral with 'free downloads/internet piracy'. And this is not just the causal consumer either. It's ridiculous, but I know many 'die hards' of shows/movies that they've never paid for in any capacity.
    Feb 24 07:39 PM | 2 Likes Like |Link to Comment
  • Netflix Is A House Of Cards On The Verge Of Collapse [View article]
    I don't see why you have to constantly berate the guy on entry/exit. I seem to remember you recommended shorting TSLA when it was slightly off it's all-time highs, but you didn't provide clear entries and exits. Given the dismissiveness of 'trading' on SA, short-term trades should be taken with a grain of salt.
    Feb 24 07:31 PM | Likes Like |Link to Comment
COMMENTS STATS
168 Comments
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