Buy Alert: Netflix is Headed Higher

Netflix's (NASDAQ: NFLX) stock is going higher. It will not happen in a straight line, but in a year or two, the stock should be way higher than where it trades today. Here's why.

Netflix is a big company today, but should be an absolutely massive company over the long term. First of all, the company's strategy is truly global. Netflix is now in over 190 countries and counting. Second, there are so many more potential subscribers for Netflix to get over time. There are about 1.7 billion households around the world, excluding China where Netflix doesn't operate. With normal population growth rates, the number of global households should exceed 2 billion in twenty years. It's reasonable to think the vast majority of those will have high-speed internet connections by then. After all, twenty years is a long time, and there are global technology companies with deep pockets that are heavily incentivized to connect more of the world's people.

At the end of last year, Netflix had 167 million global subscribers, and the company's management team expected 174 million by the end of March. That suggests the company's current subscriber count could have less than 10% of the total number of subscribers it could have looking out twenty years.

Source Fool.com