Investing Advice: The Netflix of China
By: Steve Smith
Netflix (NFLX) is the best performing stock in the S&P 500, up an astounding 88% so far in 2018. The best performing Initial Public Offering (IPO) of this year is iQIYI (IQ), which has gained whopping 91% in the less than 3 months since closing at $15.45 on first day of trading March 31. Today’s investing advice shines a spotlight on what people are calling the Chinese Netflix.
What two have in common is streaming; Netflix is the leader everywhere except China, where it doesn’t operate. iQIYI has China, whose addressable market is almost equal to the total of nearly 200 countries where Netflix does offer its service.
Even though there is not much history to the IQ chart, you can start to see a pattern, with periods of consolidation that form bullish flags followed by bursts to highs.
The latest move was especially strong, taking shares above the $30 level. This might need some time to digest, but my investing advice is this: purchases in the $27-$28 level offer a good entry point, and will likely be rewarded in the near future.
Page 1 Page 2