Netflix Stock Activity Looks Positive, Pros Say
Beaten down in the past year, Netflix buyers among the “Fast Money” experts this week.
Pete Najarian was a buyer Friday — on the options side.
“There’s a lot of activity out of the gate,” he said. “The stock was flat coming out and then you take a look at the $80 calls in the weeklies, $85 in the weeklies. In the first hour and a half 8,000 combined. It just shows you just how popular these weekly options have become.”
Netflix shares jumped 8.81 percent to close at $86.29.
Earlier in the week, talk of the company as a possible takeover target sent its stock price higher.
“Maybe you’ll get yourself a push toward $90, and that’s probably where you want to exit out of it,” said trader Joe Terranova, who was a buyer Wednesday. “ You’ve got a little of this takeover chatter. It’s worth a look.”
Terranova took as a positive sign figures that show Netflix streamed 2 billion hours of content in the last three months of 2011, a number that beat Wall Street expectations. He was a buyer Wednesday.
“That means some of the analysts’ estimates that were taken down significantly, maybe they bump them up again here in the next couple of weeks,” he said.
Justin Patterson, an analyst at Morgan Keegan, sounded positive on the company and its valuation.
“At 2 billion hours streamed, it’s pretty encouraging for Q4,” he said. “It’s trading just above one times revenue for 2013. That’s not that expensive for a company that appears to be the best positioned for streaming at this point in time.”
Jon Najarian noted that investors were betting on upside for Netflix, as March $100 calls were selling around $2.40-2.60 when the stock was trading around $75.
“There’s a lot of people that believe on the story now, and after a stock that was $300 gets down to $60, you can understand why,” he said.
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Trader disclosure: On Jan. 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; Terranova owns APC; Terranova owns OXY; Terranova owns XOM; Terranova owns VRTS; Terranova owns IBM; Terranova owns CSCO; Terranova owns AXP; Terranova owns SBUX; Terranova owns CSX; Terranova owns SWN; Terranova owns AXP; J. Najarian owns AAPL; J. Najarian owns AKS; J. Najarian owns BAC; J. Najarian owns PNC; J. Najarian owns GS; J. Najarian owns NFLX; J. Najarian owns MSFT; J. Najarian owns AA; P. Najarian is long AAPL; P. Najarian is long C; P. Najarian is long JPM calls; P. Najarian is long WFC calls; P. Najarian is long NFLX calls; P. Najarian is long MSFT ; P. Najarian is long INTC; P. Najarian is long YHOO; P. Najarian is long INTC; Weiss is long EUO; Weiss is short FXA; Grasso owns ASTM; Grasso owns AVAV; Grasso owns BA; Grasso owns D; Grasso owns LIT; Grasso owns MHY; Grasso owns PFE; Grasso owns PRST; Grasso owns S; Grasso owns XLU; Weiss is long EUO; Weiss is short FXA
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