Stock to Sell #6 – Netflix (NFLX)
An embarrassing miscalculation on customer pricing led to Netflix’s (NASDAQ:NFLX) decline from $300 in July to under $65 in November. Since then, management has tried to attract new customers, but weaker-than-expected subscriber growth and competition for streaming services from Verizon (NYSE:VZ), Redbox and others has diminished the company’s potential.
Technically NFLX has doubled from its low and is now at a significant resistance line. Its stochastic is overbought, buying volume is declining and insiders have been sellers. The recent rally is a good opportunity to sell this once-unique company’s stock.