#1: Netflix (NFLX)
Netflix (NFLX) got out to a great start in 2013, after posting a surprise profit in January when Wall Street expected a loss. The streaming video giant had invested big in international growth and new original programming, and it appears to be paying off. Since then, NFLX has never looked back. Its original show “House of Cards,” starring Kevin Spacey, won an Emmy Award.
Expansion has continued at a breakneck pace, with 20% revenue growth this year and another 20% forecast across 2014. And, of course, the stock has continued to push ever higher. Of course, whether the gains can be sustained is anybody’s guess. Competition is heating up from Amazon’s Prime Instant Video, joint venture Hulu and even paid YouTube channels from Google (GOOG). And with a forward forward P/E of about 100, it’s easy to make the case that Netflix is overbought.
Of course, betting against Netflix in 2013 proved painfully wrong. So who knows what 2014 will hold?
Jeff Reeves is the editor of InvestorPlace.com and the author of The Frugal Investor’s Guide to Finding Great Stocks. As of this writing, he did not own a position in any of the stocks named here. Write him at firstname.lastname@example.org or follow him on Twitter via @JeffReevesIP.