Markets have become increasingly impatient with even the slightest sign of slowing growth. Companies can deliver billions in revenue, rising profits, and healthy cash flow, yet a modest adjustment to guidance can erase tens of billions of dollars in market value overnight. That's undoubtedly what happened with Netflix (NFLX).
While traders focused on its guidance following second-quarter earnings, long-term investors should focus on something far more important: whether the company's competitive position and earnings power remain intact. By that measure, Netflix still looks like one of the strongest media businesses in the market.
