Hedge fund manager Whitney Tilson has officially confirmed that he’s no longer shorting Netflix, and he released a big explanation why (via Herb Greenberg).
it boils down to three points:
1) The company reported a very strong quarter that weakened key pillars of our investment thesis, especially as it relates to margins;
2) We conducted a survey, completed by more than 500 Netflix subscribers, that showed significantly higher satisfaction with and usage of Netflix’s streaming service than we anticipated (the results of our survey are in Appendix A, attached); and
3) Our article generated a great deal of feedback, including an open letter from Netflix’s CEO, Reed Hastings, some of which caused us to question a number of our assumptions.
The survey is the most interesting, because it shows that people are CRAZY about Netflix.