Diamonds and Dogs
9/4/12Netflix Inc. (NFLX)
Netflix Inc. had the curtains close on them today, down 6.35% at $55.93. The company saw its shares plummet after news was released that Amazon had reached a deal with Epix, a premium cable network. The deal between Amazon and Epix will allow Amazon to significantly increase its digital entertainment offerings of TV and movies. Netflix was on the negative end of this deal as many investors were hoping for Amazon to buyout Netflix, but now the probability of such a merger is highly unlikely. Netflix has been struggling for quite a long time now, and to make it worse Amazon is gaining footing on the company. The Amazon-Epix deal will allow Amazon to compete directly with Netflix in online TV and movie streaming. Netflix is trading just above its 52-week low but still a long ways away from its high of $221.98.
GameStop Corp. (GME)
GameStop Corp. has got game today, up 7.02% at $20.42. The company saw its shares get to the next level after Goldman Sachs upgraded the company the company from neutral to buy, with a price target of $25.00. GameStop deserves the higher price because of its increasing share of the market, due in part to greater sales of used games sold on Amazon.com. Furthermore, in the months ahead the company is expecting strength in new game releases, which will boost sales. Goldman's analyst Brian Karimzad said, "GameStop's share of new U.S. software retail has grown 674 basis points since 2010, including Amazon, via its used business and a shift out of casual games." On top of GameStop's growth, the company offers a great dividend of 5.20%.