Netflix Inc. (NFLX - Get Report) shares extended gains Friday, giving the online streaming service another crack at overtaking Walt Disney Co. (DIS - Get Report) as America's most valuable entertainment company.
The Los Gatos, Calif.-based Netflix, founded just 20 years ago by Marc Randolph and Reed Hastings, briefly surpassed its iconic 95-year-old rival in terms of market value in Thursday trading after the shares hit a record high of $354.00 each, bolstered in part by a new content agreement with former President Barack Obama and First Lady Michelle. Disney, which is attempting to buy the media assets of Rupert Murdoch's 21st Century Fox (FOXA) , has fallen 1.8% this week amid a potentially superior offer from rival Comcast Corp. (CMCSA - Get Report) .
"To me, this comparison is as fatuous as one drawn by a reporter who famously asked Babe Ruth back in 1930, how it is possible that he made $80,000 a year when President Herbert Hoover was paid just $75,000?." TheStreet's founder, Jim Cramer, said on 'Mad Money' on Thursday. "His response: 'What's Hoover got to do with it? Besides, I had a better year than he did."
That's certainly true for Netflix, at least in terms of first quarter performance, with the group adding a record 1.96 million subscribers in the United States and a further 5.46 million internationally as revenues rose 40% to $3.7 billion.
Disney, meanwhile, saw its first quarter net income in its media division fall 6% to $2.1 billion as sports network ESPN shed subscribers amid what's known as "cord cutting" by customers opting for a-la-carte media options over standard cable packages.
Netflix shares were marked 1.2% higher in early trading Friday and changing hands at $353.48 each, a move that extends the stock's extraordinary year-to-date gain past 88% and gives it a market value of $153.6 billion, just shy of the $154 billion value of Disney, based on last trading price of $102.62.
In fact, TheStreet's technical expert, Bruce Kamich, wrote earlier this week that his analysis suggested the stock was ready for a breakout.
"If we ignore a volume surge in April we could say that volume has diminished. An upside breakout above the April high would be needed to complete the triangle," Kamich argued. "A close below $300 would likely mean we are looking at some sort of topping pattern instead."