“Rumors regarding Apple’s search for a media company emerged when a recent Financial Times report said Apple executive Eddy Cue, who heads iTunes, iCloud and Apple Music, had proposed the idea of acquiring Time Warner in a meeting last year,” Bidness Etc. writes. “However, investment bankers linked with Apple told the Financial Times it would be more interested in acquiring a streaming company like Netflix, rather than a pure content player.”
“Netflix trades at almost $92 per share, which is well below its 52-week high of $133. The stock has a P/E ratio of 338 and 7.4X sales. At present, Netflix’s market capitalization stands at $39 billion, while Apple’s current cash pile is $220 billion,” Bidness Etc. writes. “That number suggests Apple can afford to be generous with its investments in several directions, and that acquiring Netflix will not be a debacle.”
Much more in the full article here.
MacDailyNews Take: As we wrote back in May:
What is unique about Netflix? A handful of TV series are not worth $40 billion. Apple is perfectly capable of taking on Netflix without having to buy them, deal with integrating their employees, etc.
Until Apple actually buys Netflix, we’ll keep saying that Apple will buy Netflix for the same reason they bought Palm.
Apple to buy Netflix? – May 27, 2016
Should Apple buy Netflix for $53 billion? – May 10, 2016
Why Apple should buy Netflix – January 7, 2016
Apple’s move into content creation could devastate Netflix and Amazon – September 1, 2015
Why Apple should buy Netflix – April 21, 2015
Why Apple should buy Netflix – March 26, 2014
Jim Cramer: Apple should buy Twitter or Netflix to spur growth – February 7, 2013
The Netflix buyout battle: Apple vs. Time Warner – April 10, 2012