Nasdaq NFLX NetFlix

Should You Buy Amazon Stock Before Dec. 19?

9 months ago
Amazon (NASDAQ: AMZN) is one of the most recognized brands on the planet. Between its online e-commerce platform and its heavy influence in the cloud computing landscape through Amazon Web Services (AWS), Amazon has evolved into a behemoth in the technology sector.
The Motley Fool

Netflix Is On Track To Hit $1,000 By Christmas

9 months ago
Shares of streaming giant Netflix Inc (NASDAQ: NFLX) have been on a tear this year, making 2024 one for the history books. The stock has surged almost 100% since January and was hitting fresh all-time highs as recently as the end of November. As we head into the last couple of
MarketBeat

Rule Breaker Investing: The 2024 Gratitude Episode

9 months ago
In this year's Gratitude episode of the Rule Breaker Investing podcast, a Motley Fool member shares his extraordinary journey from beating cancer to running marathons -- and how investing in companies like Nvidia and Shopify changed his family's future.
The Motley Fool

NFLX Quantitative Stock Analysis

9 months ago
Below is Validea's guru fundamental report for NETFLIX INC (NFLX). Of the 22 guru strategies we follow, NFLX rates highest using our Twin Momentum Investor model based on the published strategy of Dashan Huang. This momentum model looks for a combination of fundamental momentum
Validea

Up 70% This Year, Is Netflix Stock Worth The Risk?

9 months 2 weeks ago
Netflix (NASDAQ:NFLX) stock has had a solid year, rising by almost 72% in year-to-date trading. The company successfully navigated a brief subscriber decline post-Covid-19. The stock now trades at almost $840 per share led by the company’s solid execution on two fronts, nam
Trefis

Guru Fundamental Report for NFLX

9 months 2 weeks ago
Below is Validea's guru fundamental report for NETFLIX INC (NFLX). Of the 22 guru strategies we follow, NFLX rates highest using our Twin Momentum Investor model based on the published strategy of Dashan Huang. This momentum model looks for a combination of fundamental momentum
Validea

Validea Detailed Fundamental Analysis - NFLX

9 months 2 weeks ago
Below is Validea's guru fundamental report for NETFLIX INC (NFLX). Of the 22 guru strategies we follow, NFLX rates highest using our Twin Momentum Investor model based on the published strategy of Dashan Huang. This momentum model looks for a combination of fundamental momentum
Validea

Even at All-Time-Highs, Netflix (NFLX) Stock Remains an Attractive Option

9 months 2 weeks ago
As seen in the chart below, Netflix (NFLX) stock has rallied more than 85% over the past year, yet the stock might still have more room to run. The streaming giant continues to post excellent results, showing accelerating growth in both membership numbers and revenue, even as the industry landscape becomes more competitive. Netflix’s free cash flow is snowballing and is expected to surge in the coming years. So, despite a seemingly lofty valuation, there are still compelling reasons to be bullish on NFLX stock. Netflix’s Revenue Growth To begin, I think it’s quite clear that Netflix’s sustained bullish momentum comes down to one critical factor: the continued growth in its membership base. In its latest Q3 results, the company reported a 14.4% increase in global streaming paid memberships, paired with a 15% year-over-year rise in revenue. These numbers represent an acceleration over the same quarter of 2023, when membership and revenue growth stood at 10.8% and 7.8%, respectively. This level of growth is more remarkable when you consider the highly saturated streaming market, where Netflix now competes with Disney’s (DIS) Disney+, Amazon’s (AMZN) Prime Video, and various other players. Netflix’s management credited the strong revenue and membership growth in Q3 to several factors, including the success of major hits such as The Perfect Couple and Monsters: The Lyle and Erik Menendez Story, both of which significantly boosted engagement. Netflix’s advertising business, while still a relatively new part of its revenue mix, is starting to gain momentum. In fact, Ad-supported plan memberships grew by 35% quarter-over-quarter, accounting for over 50% of sign-ups in advertising-supported markets, showing promising potential as a supplementary revenue driver. Growth Can Be Sustained Netflix’s Q4 outlook gives even more reason to be bullish about its growth. Management is expecting another quarter of double-digit revenue growth, suggesting that the company’s momentum isn’t slowing down. The upcoming lineup of content, which includes blockbuster hits like “Squid Game S2” and two NFL games on Christmas Day, should help boost memberships and maintain high engagement levels. Along with higher pricing in selected markets, Netflix forecasts revenue growth of 14.7% in Q4, retaining nearly the same pace as Q3’s 15% growth and setting up a strong finish for the year. Netflix’s Free Cash Flow Snowballs In addition to Netflix’s impressive ability to sustain topline growth, one of the most compelling reasons to be bullish on its stock is the company’s rapidly increasing free cash flow. Netflix’s scale has allowed it to stabilize its capital expenditures (CAPEX), and combined with growing revenues, this has resulted in a snowball effect on its free cash flow. The concept here is economies of scale, where a growing subscriber base allows for declining CAPEX per subscriber, thus boosting margins. In Q3, Netflix posted $2.2 billion in free cash flow, up from $1.9 billion last year. Therefore, Wall Street now expects that free cash flow will reach $6.59 billion in 2024. Looking further ahead, the trend appears set to persist. Wall Street consensus estimates expect Netflix to generate $8.99 billion in free cash flow in 2025 and $10.75 billion in 2026. To me, this significant increase highlights how Netflix can leverage its growing subscriber base without a matching rise in operational costs. In fact, I believe this free cash flow growth could accelerate further due to this dynamic, which helps explain the sharp increase in expected free cash flow over coming years. To circle back to my initial argument, I believe that with such strong free cash flow generation, it’s easy to see why the stock has maintained bullish momentum, even at its current levels. Sure Netflix’s valuation remains slightly stretched, with the stock trading at 53 times this year’s expected free cash flow. However, considering the growth trajectory, Netflix’s valuation becomes more reasonable at roughly 44 times the projected free cash flow for 2026. This implies that the company, now well into the phase of achieving economies of scale, could grow into its valuation quite comfortably, thus sustaining its upside potential. Is NFLX Stock a Buy? Wall Street’s outlook on Netflix appears somewhat more cautious. The stock currently holds a Moderate Buy consensus rating, with 24 analysts recommending a Buy, 10 a Hold, and two a Sell over the past three months. Still, with an average price target of $786.86, Wall Street’s forecast suggests a potential downside risk of 5.25%. If you’re wondering which analyst you should follow if you want to buy and sell NFLX stock, checkout  Jason Helfstein from Oppenheimer (OPY). He is both the most accurate and most profitable analyst covering the stock (on a one-year timeframe), boasting an average return of 48.3% per rating and a perfect 100% success rate. Read more analyst ratings on NFLX stock Conclusion Netflix has managed to sustain excellent membership and revenue growth despite reaching a maturity phase and facing rising competition. In the meantime, its strong content lineup and expanding advertising business provide a solid foundation for continued growth. Along with accelerating free cash flow generation, I believe that Netflix seems well-positioned to leverage economies of scale, making its current valuation justifiable for investors looking to hold the stock over the long term. Disclosure
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