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Is Comcast’s Video Service Bad News for Netflix?

Comcast’s plans to launch a video-streaming service could spell trouble for Netflix, the “Fast Money” pros said Monday.

“I would short the stock rather than buy the stock,” trader Stephen Weiss said, who added that he didn’t get the valuation. “I’d rather be with Comcast or Verizon, much deeper pockets. They could put these guys out of business eventually.”

Philadelphia-based Comcast, which is the parent company of CNBC, plans to call the new service Xfinity Streampix, according to a Wall Street Journal article. It launches Thursday.

Earlier this month, Verizon and Coinstar announced a joint streaming-video venture.

Joe Terranova of Virtus Investment Partners thought there might be opportunity in shorting Netflix stock.

“The shorts, they are now no longer loaded up, which gives them plenty of ammunition if they want to press the downside, which I think they’re going to begin to do here,” he said.

Brian Kelly of Shelter Harbor Capital wasn’t a buyer.

“I’m still not a believer in the Netflix story,” he said. “When you have to pay more for a product and you have something that’s very popular and competition comes into that space, your margins automatically contract, and that’s not a stock I want to buy.”

With increased competition, first from the joint venture from Verizon and Coinstar’s Redbox division, and now from Comcast, Patty Edwards of Trutina Financial also thought to look elsewhere.

“If you want to play this, what you want to play is someone who has something that no one else does,” she said. “That’s the Redbox, that’s Coinstar, and it’s a heck of a lot cheaper.”


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Trader disclosure: On Feb. 21, 2012, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders: Terranova is long VRTS; Terranova is long IBM; Terranova is long HPQ; Terranova is long MCD; Terranova is long EMC; Terranova is long OXY; Terranova is long SBUX; Terranova is long SWN; Terranova is long MSFT; Terranova is long YUM; Terranova is long TBT; Terranova is long FXE; Terranova is long LPX; Terranova is long LQD; Weiss is long MDRX; Weiss is long DMND; Weiss is long CHK; Weiss is long EUO; Weiss is long CSC; Weiss is long F; Weiss is long BKU; Weiss is long QCOM; Weiss is long NS; Weiss is long POT; Weiss is long SNDK; Weiss is long WLP; Weiss is long VZ; Weiss is short MT;

For Brian Kelly
Shelter Harbor Capital is long gold futures

Shelter Harbor Capital is long SLV

Shelter Harbor Capital is long SPY calls

Shelter Harbor Capital is long SPY puts

For Patty Edwards
Trutina Financial is long AAPL

Trutina Financial is long GLD

Trutina Financial is long PGM

Trutina Financial is long INTC

Trutina Financial is long QCOM

Trutina Financial is long COST

Trutina Financial is long HLF

Trutina Financial is long JOY

Trutina Financial is long CBI

Trutina Financial is long VZ

For Dennis Gartman
Gartman is short the Euro, Swiss Franc, Yen

Gartman is long Canadian dollars, Australian dollars & Gold

Gartman owns gold in Yen terms

Gartman owns gold in Euro terms

For Dan Dicker
Dicker is long APA

Dicker is long TOT

For Tim Shea
No disclosures

For Shaw Wu
Sterne Agee makes a market in shares of Dell

For Todd Gordon
No disclosures

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NFLX
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VZ
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