Shares of Netflix (NASDAQ: NFLX) jumped more than six percent Tuesday, up $16.23 to $284.18 after the company said it will start streaming video services in Latin America and the Caribbean later this year.
The exansion is a boost to the stock of the fast-growth video service provider because the move signals the company's first expansion to the international market beyond the United States and Canada, where it currently operates.
Investors have been watching closely to see when Netflix might expand internationally. The company's stock is up from its 52-week low of $95.33 to an all-time high on the news.
Analyst Jamie Townsend with TownHall research reiterated a buy rating on Netflix following the company's international expansion announcement.
Mexico and Brazil are the pay TV powerhouses of Latin America, he said. Brazil has 8.9 million pay TV homes now and will have around 20 million by the end of 2014. Mexico has 9.7 million pay TV homes today and this will grow to 18.7 million pay TV homes by 2014. These are strong markets growing very rapidly, with 26 percent and 40 percent growth respectively during 2010.
The movie rental company experiencing rapid growth with its online services, said it will expand to 43 countries in Latin America and the Caribbean later this year, offering unlimited TV shows and movies over the Internet for a base monthly subscription price.