No, not a stock split. Rather, several large investors called for a split in the roles of chairman and CEO, titles currently held by Netflix founder Reed Hastings. California public pension fund Calpers and New York City Comptroller Scott Stringer were seeking an independent board chairman for the company in a vote which failed to pass on Monday.
Last year, nearly three quarters of the Netflix's shareholders voted to split up the two positions. But, like last year, this year's vote was nonbinding. An independent chairman is generally considered a corporate governance "best practice" though efforts at other companies – most notably, JP Morgan Chase – have also failed despite repeated attempts.
A split between Netflix's chairman and CEO roles "will probably happen" eventually, said Steve Cortes, founder of Veracruz TJM, but he doesn't see that as changing the ultimate price of the stock.
"These kinds of corporate governance things tend to get a lot of media attention," Cortes said, "But I don't think they have a whole lot of effect on the value of the company."
Nonetheless, Cortes is skeptical of the stock price at current levels. "This stock has made a higher high 12 out of the last 14 sessions," notes Cortes. "That is getting extremely frothy."
One of Netflix's threats is Amazon Prime's streaming video service, according to Cortes. "I don't think Netflix is going to own this space the way it has in the past," Cortes said. "To pay 60 times next year's earnings for a company that faces stiff competition in the future, to me, that is just not a sensible bet."
Netflix will likely see higher costs for content going forward as rivals offer to pay higher prices for shows.
"Because there are behemoths like Amazon who is going to be bidding against them for content," Cortes said, "content prices are going to go up dramatically and [Netflix] probably can't pass it along to the consumer."
Richard Ross, global technical strategist at Auerbach Grayson, is also wary of Netflix's stock price, which is around the $420 level on Monday.
"While one of the big stories in the broader market is the lack of volatility, stocks like Netflix actually display an extraordinary amount of volatility," said Ross, a "Talking Numbers" contributor. "It's almost untradeable at these levels in my opinion."
That volatility manifested itself with Netflix's shares losing a third of its value from February to April of this year, followed by a 43 percent rebound.
On a longerterm basis, Ross suggests investors look at Netflix's 50-week moving average. "It has really provided a great trading signal – buying when we break above it, selling when you break below it," he said. With the 50-week moving average around $340 per share right now, "technically speaking – no pun intended – we are still on a buy."
But, just because the stock is 25 percent above $340, that doesn't mean Ross is bullish on Netflix. On the contrary, he thinks now is a time to get out of the stock.
"There's a lot of room to fall here to generate that sell signal," Ross said. "I would be a seller up here; I would be a stronger seller below $340."
Ross sees an eventual move down to the $300 support level, which was around the stock's 2011 highs.
"We were just there five weeks ago," Ross added. "I think we're going to revisit that level and we could break even lower. I would be a seller."
To see the full discussion on Netflix, with Cortes on the fundamentals and Ross on the technicals, watch the above video.