Netflix Inc. (NFLX): Today's Featured Specialty Retail Laggard

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

Netflix ( NFLX) pushed the Specialty Retail industry lower today making it today's featured Specialty Retail laggard. The industry as a whole closed the day up 0.4%. By the end of trading, Netflix fell $1.40 (-2.4%) to $56.39 on light volume. Throughout the day, 3.4 million shares of Netflix exchanged hands as compared to its average daily volume of five million shares. The stock ranged in price between $56.29-$57.84 after having opened the day at $56.86 as compared to the previous trading day's close of $57.79. Other companies within the Specialty Retail industry that declined today were: Hollywood Media Corporation ( HOLL), down 5.7%, Bluefly ( BFLY), down 4.7%, Coinstar ( CSTR), down 3.6%, and Cencosud ( CNCO), down 2.5%.
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Netflix, Inc. provides Internet subscription services for TV shows and movies in the United States and internationally. The company offers its subscribers to watch unlimited TV shows and movies streamed over the Internet to their TVs, computers, and mobile devices. Netflix has a market cap of $3.26 billion and is part of the services sector. The company has a P/E ratio of 32.3, equal to the average specialty retail industry P/E ratio and above the S&P 500 P/E ratio of 17.7. Shares are down 15.2% year to date as of the close of trading on Friday. Currently there are three analysts that rate Netflix a buy, six analysts rate it a sell, and 20 rate it a hold.

TheStreet Ratings rates Netflix as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth, reasonable valuation levels and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, weak operating cash flow and generally higher debt management risk.

On the positive front, Sport Chalet ( SPCHA), up 11.2%, Mecox Lane ( MCOX), up 10.1%, Big five Sporting Goods Corporation ( BGFV), up 8.1%, and Barnes & Noble ( BKS), up 6.6%, were all gainers within the specialty retail industry with Sally Beauty Holdings ( SBH) being today's featured specialty retail industry leader.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the specialty retail industry could consider SPDR S&P Retail ETF ( XRT) while those bearish on the specialty retail industry could consider ProShares Ultra Sht Consumer Goods ( SZK).

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