David Trainer Explains the Most Overvalued Stock on the Market

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CEO David Trainer doesn’t usually agree with Mad Money’s Jim Cramer. But when a stock is this overvalued, analysts of all types are in consensus. In today’s podcast, Trainer shows you how a discounted cash flow model reveals one company’s stock to be extremely overvalued.

Listen below:

Photo credit: Patrick Brietenbach

2 Comments

  • Inverseio

    January 27, 2015

    If this podcast was broadcast on 1/22/15 I am assuming that the price of Netflix used for the analysis was the 1/21 close ($421). The stock closed today (1/27) at $454. Ouch! That is about an 11% increase in 4 trading days. If I was short at $421, I would hate to open an Excel spreadsheet and extrapolate that performance out 30 years 🙂

    Look at the trend in the recent closing prices: 454, 446, 437, 428, 409, 348 (not a typo), 337, 323, 324, 323, 318.

    Remember the old saying, “Markets can remain irrational a lot longer than you can remain solvent”.

    My condolences to anyone who put that trade on.

  • Andre Rouillard

    January 28, 2015

    Inverseio,
    Thanks for your comment. We tend to agree with that old market aphorism, but certainly wouldn’t want to be in NFLX anywhere close to these levels.

    If you’re interested in a more in-depth look at our take on Netflix, we’re currently running a $0.99 deal on our analysis of the company’s latest quarterly report. As a Free member, you should have received the offer via email today. I encourage you to check it out.

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