Netflix’s Competition Heats Up

May 23, 2022

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Netflix’s Competition Heats Up

Netflix (Nasdaq: NFLX) is an example of a company driven by infinite growth that has hit a wall, says John Engle, president of Almington Capital Merchant Bankers, in a new episode of the Early Bird Podcast.

Growing Pains: Netflix has produced healthy revenue for some time, but the cost of revenue is growing due to its reliance on getting licensed content, according to Engle.

Exposed: Retail investors have considered exposure to Netflix, says Engle, and this serves as an example of the dangers of narrative-driven stocks in rapidly evolving industries.

Competition: Engle says that there are also other companies in the streaming space, such as Disney (NYSE: DIS), Paramount Global (Nasdaq: PARA), Apple (Nasdaq: AAPL), and Amazon (Nasdaq: AMZN).

Final Thoughts: What advice does Engle have for investors interested in streaming stocks? Find out by listening to a new episode of the Early Bird podcast.

Notables

Notable Earnings Today: XPeng (NYSE: XPEV), Zoom Video Communications (Nasdaq: ZM), Niu Technologies (Nasdaq: NIU), Advance Auto Parts (NYSE: AAP), China Automotive Systems (Nasdaq: CAAS), Skyline Champion (NYSE: SKY), Start Equity Holdings (Nasdaq: STRR), Toughbuilt Industries (Nasdaq: TBLT), Qiwi (MCX: QIWI), America's Car-Mart (Nasdaq: CRMT), Nordson (Nasdaq: NDSN), Walkme (Nasdaq: WKME), Euroseas (Nasdaq: ESEA), Nautilus (NYSE: NLS), Capital Southwest (Nasdaq: CSWC), Transcat (Nasdaq: TRNS).

Notable IPOs Today: N/A.

Notable Equity Crowdfunding Campaigns Ending Today: Fisco’s Chicken (Honeycomb), Duo Marketplace (SMBX), Kava Garden (MainVest).

Notable Economic Events Today: N/A.

Broadcom Eyes VMware Acquisition

Photo by Florian Krumm / Unsplash

Semiconductor manufacturing company Broadcom (Nasdaq: AVGO) wants to acquire cloud-computing company VMware (NYSE: VMW), according to a Bloomberg report Sunday.

Details: Both companies are discussing a cash-and-stock deal, according to The Wall Street Journal. VMware is currently worth $40 billion and Broadcom is worth over $220 billion.

Background: It’s been a tough few months for the semiconductor industry due to issues with supply and consumer spending. By acquiring VMware, Broadcom would diversify its revenue outside of semiconductors.

Numbers: Shares of both companies are down over 18% so far this year, as part of the broader tech selloff.

Final Thoughts: While the acquisition could be finalized soon, it could also fall apart. Both companies have not commented on the deal so far.

Stock Market Crash 2022: Numbers

How bad has the stock market crash of 2022 been? Let’s take a look.

“Down” Jones: The Dow Jones Industrial Average is down over 14% so far in 2022.

Standard Very Poor: The S&P 500 is down over 18% this year, resulting in one of its worst annual starts ever.

No, Nasdaq: Meanwhile, the tech-heavy Nasdaq is down over 28% in 2022.

Final Thoughts: Most sectors have started the year off on a bad note. Is the 2022 stock market crash over or is it just beginning?

Trends to Watch

Can’t Stop, Won’t Stop: China Can’t Seem to Stop Bitcoin Mining (CoinDesk)

Could Get Worse: Conditions Are Ripe for a Deep Bear Market (The Wall Street Journal)

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