UPDATE, 1:30 PM: Netflix recovered slightly to close at $279.00, down 2.8%.
PREVIOUS, 10:25 AM: It’s another bad day for Netflix. The stock is down about 4% in midday trading after Pacific Crest Securities downgraded the company to the equivalent of neutral from buy. The problem isn’t so much the PR blow that the home video firm took last week following its 60% increase in the price of its combined streaming and DVD rental service. Analyst Andy Hargreaves says that a you’d need to make what he calls “aggressive” assumptions to envision the company adding lots of subscribers or improving its profits. That would “leave little room for missteps or changes in market conditions,” he writes.
Netflix also riled some customers this morning: Many reported that they were unable to use the streaming service early this morning. A few hours after the problems were first reported Netflix tweeted that the problem had been fixed.