Is Netflix a good company to buy stock in?
Compared to the average firm in the Nasdaq, Netflix has a stronger growth outlook, better profit margins, and generates a higher return on equity. Put differently, Netflix's stock deserves to trade at a higher P/E ratio than the Nasdaq and a ~25% premium looks fair.
Netflix stock has an IBD Relative Strength Rating of 94 out of 99. The rating shows how a stock's price performance stacks up against all other stocks over the last 52 weeks. It has a best-possible IBD Composite Rating of 99.
Netflix projects earnings of $4.68 per share, indicating growth of 42.2% year over year. The Zacks Consensus Estimate for the same is pegged at $4.70 per share, currently higher than the company's expectation. The estimate has been unchanged over the past 30 days.
In 2021, the streaming entertainment giant was named the 8th most trusted brand globally by Morning Consult. Also, Netflix is the largest media & entertainment company by market capitalization. Netflix is a publicly traded company, making its stock available to anyone of legal age interested in purchasing shares.
So, if you had invested in Netflix ten years ago, you're likely feeling pretty good about your investment today. A $1000 investment made in March 2014 would be worth $9,728.72, or a gain of 872.87%, as of March 4, 2024, according to our calculations. This return excludes dividends but includes price appreciation.
Risk and Uncertainty
Our Uncertainty Rating for Netflix is High, largely based on the evolving streaming media landscape and the additional competition the company now faces.
Fair Value Estimate for Netflix Stock
With its 2-star rating, we believe Netflix's stock is overvalued compared with our long-term fair value estimate of $440, which implies a multiple of 24 times our 2024 earnings per share forecast.
Netflix Inc. shares tumbled the most in two years on Friday as a weak forecast for revenue and a warning that the streaming giant will stop reporting subscriber numbers in 2025 overshadowed an otherwise strong start to the year.
Netflix (NASDAQ: NFLX) is owned by 80.12% institutional shareholders, 6.44% Netflix insiders, and 13.44% retail investors. Rick Kimball is the largest individual Netflix shareholder, owning 8.01M shares representing 1.86% of the company. Rick Kimball's Netflix shares are currently valued at $5.15B.
| Year | Prediction | Change |
|---|---|---|
| 2025 | $ 840.34 | 29.78% |
| 2026 | $ 1,090.60 | 68.43% |
| 2027 | $ 1,415.40 | 118.60% |
| 2028 | $ 1,836.94 | 183.70% |
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Asked about the breakout stocks to buy today, Bagadia recommended these five shares to buy ahead of the Budget 2024: Sportking India, AWHCL, Nitin Spinners, RCF, and Gravita India.
Netflix's first-mover advantage is perhaps the biggest factor of its success. Netflix now generates enough free cash flow to repurchase shares. The valuation is reasonable enough that investors could still do well in the long term.
You would have more than doubled your money, with a total investment worth of $2,029.55. That's a 103% return, or a 7.23% annual rate of return.
- The all-time high Netflix stock closing price was 691.69 on November 17, 2021.
- The Netflix 52-week high stock price is 697.49, which is 7.7% above the current share price.
Stock Price Forecast
The 31 analysts with 12-month price forecasts for Netflix stock have an average target of 681.61, with a low estimate of 465 and a high estimate of 800. The average target predicts an increase of 5.27% from the current stock price of 647.50.
Based on analyst ratings, Walt Disney's 12-month average price target is $128.04. Walt Disney has 36.02% upside potential, based on the analysts' average price target. Walt Disney has a consensus rating of Strong Buy which is based on 21 buy ratings, 5 hold ratings and 0 sell ratings.
Amazon Stock: Wall Street Projections For 2024
Still, Wall Street analysts are broadly positive on Amazon stock. Of the 66 Amazon stock analysts following the company, 95% hold a buy rating, according to FactSet. That's among the highest percentage for all stocks tracked by FactSet.
Based on analyst ratings, Coca-Cola's 12-month average price target is $69.50. Coca-Cola has 6.45% upside potential, based on the analysts' average price target. Coca-Cola has a consensus rating of Strong Buy which is based on 14 buy ratings, 2 hold ratings and 0 sell ratings.
Why is Netflix stock falling?
April 19 (Reuters) - Netflix shares fell on Friday as its plan to stop sharing subscriber numbers from 2025 stoked growth worries, with analysts warning that rivals may follow the step by scrapping the key metric on the streaming industry's health.
Based on analyst ratings, Costco's 12-month average price target is $910.05. Costco has 8.30% upside potential, based on the analysts' average price target. Costco has a consensus rating of Strong Buy which is based on 19 buy ratings, 6 hold ratings and 0 sell ratings.
Netflix has a consensus rating of Moderate Buy which is based on 23 buy ratings, 12 hold ratings and 1 sell ratings. What is Netflix's price target? The average price target for Netflix is $673.89.
Quarterly Netflix subscribers count worldwide 2013-2024
Netflix had around 277.65 million paid subscribers worldwide as of the second quarter of 2024. This marked an increase of over eight million subscribers compared with the previous quarter.
To buy fractional shares of Netflix stock, you'll need to sign up for Stash and open a personal portfolio. Stash allows you to purchase smaller pieces of investments, called fractional shares, rather than having to pay the full price for a whole share.
