Netflix, Inc. (NFLX), The Walt Disney Company (DIS) and the Streaming Path Forward

Another large potential headache is Apple Inc. (NASDAQ:AAPL). It would take a very, very small technological leap for Apple Inc. (NASDAQ:AAPL) to extend its iTunes system into televisions across the world. The company can already delivery content on iPhones and iPads as well as through Apple Inc. (NASDAQ:AAPL) TV devices. To place that same content through some other system than the company’s proprietary one would be a radical change in concept, though. Keep an eye on this undervalued company. Even with the recent slide in share prices it’s still very profitable and well-run. I’m looking for a strong rebound in the last half of this year. I just wish it was cheaper.

The last major competitor (sorry, Redbox) is Time Warner Inc (NYSE:TWX) and that company’s Home Box Office. HBO has been into delivering movies for a long time, of course, but it’s been aggressively moving into on-demand as opposed to scheduled delivery. A recent 10-year deal with Universal locks Netflix, Inc. (NASDAQ:NFLX) out of a large roster of premium movie content as well. Time Warner Inc (NYSE:TWX)’s another good, diverse stock for investors to hold. A mature company, it’s not as sexy as more tech-centric firms. But it does grow (67.41% in the last 12 months), pays a dividend of 1.92% and turned a 10.20% net profit in 2012. All of that makes Time Warner Inc (NYSE:TWX) worth close inspection.

Heading Downstream

In the end, the most likely scenario I see for Netflix is a buyout. Sooner or later one of the really big players will eventually snap the company up and shareholders will be joyful. The challenges that Netflix, Inc. (NASDAQ:NFLX) faces without its own diverse content library may be too much for an independent company to overcome. The important thing for you, as an investor, is to be aware of that and to watch it as it runs up and down in value with its partners.

The article Netflix, Disney and the Streaming Path Forward originally appeared on Fool.com and is written by Nate Wooley.

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