Netflix: Stifel Downgrades to Sell After Stock Doubles

Netflix (NFLX) is suddenly one of the Valley’s hottest companies, as the DVD-by-mail company gradually morphs into everyone’s favorite streaming movie service. The service is showing up everyplace: on TiVo boxes, on the Web, on Xbox Live, in Blu-Ray disk players. The company reported blowout Q4 earnings earlier this week and provided a strong Q1 outlook. Netflix has become a hot counter-cyclical, nesting-in-the-living room recession play; the stock has doubled since late November.

Stifel Nicolaus analyst Scott Devitt thinks the rally has gotten a bit out of hand; he downgraded the shares this morning to Sell from Hold, asserting that fair value is about $28, or well below the current level.

Read the rest of this post