NEW YORK (TheStreet) -- Seemingly forever, Netflix (NFLX) has been portrayed as the overvalued, underprofitable poster child for that darn nutty Internet sector. So could the movies-on-demand giant really be about to earn $35 a share within a couple of years?
RBC Capital analyst Mark Mahaney thinks so. And that view is not as crazy as you might think.
Netflix shares are down nearly 6%, or almost $27, to about $425.20 as of 1 p.m. Tuesday. The drop follows a report of second-quarter earnings that slightly topped most estimates for both profit and subscriber growth. Net income more than doubled to $71 million, or $1.15 a share, from $29 million, or 49 cents a share, in last year's second quarter. But Netflix said third-quarter earnings would be lower than expected because it's planning to take a bigger loss in Europe to expand faster.
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