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Joe Terranova: Facebook to 'Cuddle Up' to Netflix?

Just when you think the tailwinds propelling Netflix can’t possibly blow any harder, this happens.

In a New York Times article, former Yahoo CEO Terry Semel says he thinks Netflix could make an attractive takeout target – despite the lofty valuations.

"There are five or six large technology companies that are very much in need of real content,” he tells the Times. “You have to invest in that.”

And he suggests that even at $15 billion, which is the current market cap of Netflix, the price may be attractive considering the rapidly changing landscape in media.

”Content will be a major factor in advertising sales and audience scale,” he says. “Before content was user generated,” he adds. “But there is a need for professional content with real audiences.”

Jon Najarian agrees and thinks that Netflix may be in the sweet spot.

“The producers of content need to find an alternative way to get more money for that content. The distribution patterns and the cost of distribution just isn’t working. And Netflix provides that.”

Joe Terranova thinks Facebook wants to 'cuddle up to Netflix.' He thinks that kind of partnership would generate fantastic synergy. "Think about the potential," he says.

And he adds, "don't forget the fact that Netflix CEO Reed Hastings sits on the board of Facebook. Don't overlook that," he says.

And in case you're wondering, Terranova thinks Google will buy Hulu.






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Trader disclosure: On July 6, 2011, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders; Stutland owns (C), short (C) calls; Stutland owns (CSCO), short (CSCO) calls; Stutland owns (F); Stutland owns (GE) corporate bonds; Stutland owns (GLD); Stutland owns (GOOG), is short (GOOG) calls; Stutland owns (INTC), is short (INTC) calls; Stutland owns (T) is short (T) calls; Jon Najarian owns (BIDU) calls; Jon Najarian owns (SINA) calls; Jon Najarian owns (UA) calls; Jon Najarian owns (NFLX) calls; Jon Najarian owns (SLV) calls; Jon Najarian owns (SLW) calls; Terranova owns (XOM); Terranova owns (HAS); Terranova owns (DIS); Terranova owns (WFM); Terranova owns (LULU); Terranova owns (MSFT); Terranova owns (TM); Terranova owns (JWN); Terranova owns (MCD); Terranova owns (PEP); Terranova owns (MA); Terranova owns (BX); Terranova owns (CAT); Terranova owns (VRTS); Terranova owns (AAPL); Terranova owns (F); Terranova owns (CVI); Terranova owns (IBM); Terranova owns (FCX); Weiss owns (DE); Weiss owns (NAN); Weiss owns (HBAN); Weiss owns (BTU); Weiss owns (KEY); Weiss owns (CMA); Weiss owns (COP); Weiss owns (HK); Weiss owns (MRK)

For Brian Stutland
Stutland equities is a market maker in in VIX futures and options, S&P 500 options, and VXX stock and options holding positions in all these instruments.
Stutland equities holds positions in SPY stock and options and e-mini S&P 500 futures. All positions are hedged.

For Joe Terranova
Terranova is Chief Market Strategist of Virtus Investment Partners, LTD
Virtus Investment Partners Owns More Than 1% Of (ABAX)
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Virtus Investment Partners Owns More Than 1% Of (CCG)
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Virtus Investment Partners Owns More Than 1% Of (XLF)
Virtus Investment Partners Owns More Than 1% Of (XLI)
Virtus Investment Partners Owns More Than 1% Of (XLK)
Virtus Investment Partners Owns More Than 1% Of (XLU)
Virtus Investment Partners Owns More Than 1% Of (SUBK)
Virtus Investment Partners Owns More Than 1% Of (WDFC)
Virtus Investment Partners Owns More Than 1% Of (YDNT)
Virtus Investment Partners Owns More Than 1% Of DOMINO'S PIZZA UK & URL PLC
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