Netflix (NFLX) reports tonight as everyone knows. Lots of people talking about the sky high valuation, but I have always contended that you have to look at this company as an opportunity play a worldwide personal computer and handheld network of programming that could, ultimately, have a billion subscriptions.
I pushed Apple mightily to buy it much lower. Now it is too high.
But I wanted to take a moment to point out that while Netflix can't be valued as a traditional stock, meaning how much you pay for its earnings per share, that does not make it the same as the other stock that seems to be unhinged from traditional fundamentals: Tesla (TSLA) .
The revolutionary car company doesn't deserve to trade where it does on earnings or even on its franchise as an automobile maker. But if you view it as a technology company it can make some sense. I say some sense because I would like to see more technology out of the company versus what I am starting to see from other companies like Volvo. Sure, it is scaling rather remarkably and yes it is well-loved, but tech companies that can withstand traditional multiple analysis tend to have much more of a moat than Tesla.
Still, it doesn't matter. Beauty is in the eye of the beholding shareholder and that's who keeps the stock of Tesla aloft.
To me the issue is simple: if Netflix sells off I want to be a buyer because I think the franchise is worth $69 billion. If Tesla sells off I do not want to be a buyer because I think it is a car company with a solar business and not more than that.
But before you say why not sell it short I would come back and say "Who knows how high it can go. It's all about love versus hate and it's a referendum on whether it is a tech company or a car company and I do not want to be the judge.
I know there are plenty of people who want me to opine on Tesla. I say, why do I have to opine on everything? Some stocks are just too hard.
Netflix isn't too hard. I like it both before and after earnings. Tesla? I don't like it and I don't dislike it.
And I love the car itself way too much to bet against the darned thing.