Over the years we have seen Netflix grow into a much larger company, but a recent business decision, which was shocking for some has now had an effect of NFLX stock growth. Over the past two months the value of the company has been reduced by almost 50 percent, and just today another 7.3 percent has been wiped of the value, which now stands at just $143.75.
The reason for this is due to the fact that Netflix has now decided to split the company in two. The part of the business that deals with DVD-by-mail will now be known as Qwikster, which does not rest easy with customers or investors. CBS News points out one fact that was first overlooked, and that is if you subscribe to both streaming and DVD then you will soon receive two separate bills, which could become a nuisance.
For years investors were getting rich thanks to investing in Netflix, but it looks as though that bubble has now burst. Do not get us wrong, things should turnaround, but not in the short-term. However, there are suggestions from certain analysts that the company has now seen its best days. Now that we think about it, there could actually be some truth to this, as there is far more competition for Netflix than there once was back in the good old days.
This is something that is happening more and more with companies such as Netflix that once had the monopoly on a certain market. We should not worry too much though, as Netflix has brought this on themselves, in a time when there is greater competition, why on earth would they introduce a price increase? As for the competition, that is better news for you and I, as there is now a greater choice.
*Identifying Monetised Links - outgoing links that we monetise are marked with an '*' symbol.