A lot of bad things have happened with regard to NFLX lately.  And I totally get why it has sold off.  Among other things the idea of splitting off the dvd-by-mail business from streaming, and having two different brands, was asenine.  At least they didn't go through with it.

A more to-the-point critique I think is that the business of streaming is just not that profitable of a business.  Because of the Betamax case and 'fair use', renting DVDs was quite profitable.  But with streaming, the studios get to name their price and it's not a buy-once, rent-many price, it's a price per-user-viewing.  This whole business model is not in Netflix's favor.

And add to that, the studios seem to view NFLX as an enemy and would prefer to work with, I don't know, Hulu?  They'd prefer to work with Comcast and sell their movies for $5 a viewing - which is a pretty ridiculous price point if you ask me.

However, with the market cap cut down so drastically, I see this stock as underpriced.  It's gone from a growth stock to a value play, basically.

They still make money hand over fist and have a huge leg up on their competition.  And despite some damage to their brand in the eyes of their customers, it's still a very strong brand, and they'll recover.

It's a natural tendency of the stock market to swing to extremes, overvaluing a stock while it's a Wall St darling growth stock, then undervaluing it once it's lost its lustre.  So it seems only natural that after a big drop now, we'll see a modest rise.