Netflix was plummeting after-hours Thursday following a mixed quarter.
The streaming company missed on its bottom line but beat revenue expectations. Netflix also offered weak guidance for subscriber growth.
John Petrides, portfolio manager at Tocqueville Asset Management, is long-term cautious on the stock.
"I've been negative on Netflix for quite some time from a valuation standpoint and continue to think the business model is suspect," Petrides told CNBC's "Trading Nation" on Thursday before the release. "They have to rely on constantly coming up with original content in order to drive viewership, and that's expensive."
Still, he said it's hard to bet against Netflix given its outperformance. The stock is up 62% this year, driven by a rotation into stay-at-home plays amid the coronavirus pandemic.
But, he said, "the long-term story is that there are more streaming players out there with their own content library where they don't have to go to the market and buy their content like Netflix does, and spend a lot of money. And I think ultimately that that's going to be the competitive pressure that hurts Netflix subscriber growth over time."
Instead, Matt Maley, chief market strategist at Miller Tabak, sees opportunity in a different FANG stock, the acronym that groups high-growth names Facebook, Amazon, Netflix and Google parent Alphabet. He said the "G" – Alphabet – could have the most potential.
Alphabet "as much as it has rallied – it's up [50%] from March lows – it's actually been lagging behind these other mega-cap tech stocks," Maley said during the same segment.
Facebook, Amazon and Netflix are all up at least 75% from their March lows.
Unlike the others, Maley notes Alphabet has also not broken above its February highs. Its relative strength chart, or RSI, also suggests it has more room to run. It has an RSI of 60, below the 70 level that suggests overbought conditions.
"If these groups – which I think are ready for a correction – come down, [Alphabet] is going to have less downside potential," Maley said. "On the downside I like it because it's got less downside potential, and once it breaks its February highs it's actually got more upside potential than some of these other names that have had such huge rallies this year."
Alphabet is up 13% this year, the weakest gain of the FANG stocks.