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5 Top Turnaround Stocks

These former flops have seen great gains this year

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netflix nflx stockIndustry: Consumer Services
Year-to-Date Returns: 238%

Netflix (NFLX) was nearly left for dead in late 2011 after the Qwikster PR debacle that irritated customers with both the gall of NFLX splitting its DVD and streaming businesses without asking, and the threat of price increases driving away customers.

But the company muddled through, and not only held on to market share amid tough competition from other streaming video providers like Hulu, but grew the business at home and abroad.

Netflix made an ambitious investment in original programming and international growth, and while some bulls expected validation, eventually it shocked even them to see 2013 open with a surprise profit — then an amazing 14 Emmy nominations for its original programming offerings.

And the story is still rolling at Netflix, with House of Cards actually bringing home three Emmy awards for NFLX and international growth continuing at a brisk pace.

Of course, whether the gains can be sustained is anybody’s guess. Competition is heating up from (AMZN) with its Prime Instant Video and others will continue, and the streaming video space is still very young.

But don’t bet against Netflix. A company that theoretically ruined its brand and returns to dominance a short time later clearly has staying power.

Jeff Reeves is the editor of and the author of The Frugal Investor’s Guide to Finding Great Stocks. Write him at or follow him on Twitter via @JeffReevesIP. As of this writing, he did not own a position in any of the stocks named here.

Article printed from InvestorPlace Media,

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