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Netflix has scared the living daylights out of Wall Street. The "U can’t touch this" streaming company said it gained about one million fewer subscribers than it had expected in the second quarter, sending its normally high-flying stock down about 14% on Monday. Expectations are high, even seemingly excessive, with Netflix looking rather expensive at roughly $400 a share (that’s equivalent to, ahem, 239 times the per share earnings that analysts expect the company to make this year). Consider this: the S&P 500 trades at 22 times earnings, and the average media industry p:e is 14. Also, before its earnings report Netflix shares had gained 109%, making it the second-strongest performer on the S&P 500 index. The company blamed a strengthening dollar for its weaker-than-expected international revenue (it doesn’t hedge with derivatives) and the subscriber-target miss was a result of faulty internal forecasting. The company made $384m in profit on $3.9bn in sales. Netflix, in a letter to ...

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