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NETFLIX INC (NFLX) Stock Fundamental Analysis

NASDAQ:NFLX - Nasdaq - US64110L1061 - Common Stock - Currency: USD

1194.44  +2.42 (+0.2%)

Fundamental Rating

6

NFLX gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 71 industry peers in the Entertainment industry. NFLX gets an excellent profitability rating and is at the same time showing great financial health properties. NFLX is not overvalued while it is showing excellent growth. This is an interesting combination. With these ratings, NFLX could be worth investigating further for growth and quality investing!.


Dividend Valuation Growth Profitability Health

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8

1. Profitability

1.1 Basic Checks

In the past year NFLX was profitable.
In the past year NFLX had a positive cash flow from operations.
Each year in the past 5 years NFLX has been profitable.
In the past 5 years NFLX always reported a positive cash flow from operatings.
NFLX Yearly Net Income VS EBIT VS OCF VS FCFNFLX Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 2B -2B 4B 6B 8B 10B

1.2 Ratios

NFLX has a better Return On Assets (17.80%) than 98.59% of its industry peers.
The Return On Equity of NFLX (38.58%) is better than 92.96% of its industry peers.
Looking at the Return On Invested Capital, with a value of 22.93%, NFLX belongs to the top of the industry, outperforming 97.18% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for NFLX is significantly below the industry average of 23.28%.
The last Return On Invested Capital (22.93%) for NFLX is above the 3 year average (16.17%), which is a sign of increasing profitability.
Industry RankSector Rank
ROA 17.8%
ROE 38.58%
ROIC 22.93%
ROA(3y)12.2%
ROA(5y)11.02%
ROE(3y)27.7%
ROE(5y)28.07%
ROIC(3y)16.17%
ROIC(5y)15.85%
NFLX Yearly ROA, ROE, ROICNFLX Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 10 20 30

1.3 Margins

With an excellent Profit Margin value of 23.07%, NFLX belongs to the best of the industry, outperforming 94.37% of the companies in the same industry.
In the last couple of years the Profit Margin of NFLX has grown nicely.
With an excellent Operating Margin value of 27.71%, NFLX belongs to the best of the industry, outperforming 97.18% of the companies in the same industry.
NFLX's Operating Margin has improved in the last couple of years.
NFLX's Gross Margin of 46.92% is in line compared to the rest of the industry. NFLX outperforms 53.52% of its industry peers.
In the last couple of years the Gross Margin of NFLX has grown nicely.
Industry RankSector Rank
OM 27.71%
PM (TTM) 23.07%
GM 46.92%
OM growth 3Y8.59%
OM growth 5Y15.63%
PM growth 3Y9.04%
PM growth 5Y19.25%
GM growth 3Y3.42%
GM growth 5Y3.77%
NFLX Yearly Profit, Operating, Gross MarginsNFLX Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 10 20 30 40

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7

2. Health

2.1 Basic Checks

The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so NFLX is creating value.
NFLX has less shares outstanding than it did 1 year ago.
NFLX has less shares outstanding than it did 5 years ago.
NFLX has a better debt/assets ratio than last year.
NFLX Yearly Shares OutstandingNFLX Yearly Shares OutstandingYearly Shares Outstanding 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 100M 200M 300M 400M
NFLX Yearly Total Debt VS Total AssetsNFLX Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 10B 20B 30B 40B 50B

2.2 Solvency

An Altman-Z score of 13.29 indicates that NFLX is not in any danger for bankruptcy at the moment.
With an excellent Altman-Z score value of 13.29, NFLX belongs to the best of the industry, outperforming 98.59% of the companies in the same industry.
NFLX has a debt to FCF ratio of 2.02. This is a good value and a sign of high solvency as NFLX would need 2.02 years to pay back of all of its debts.
The Debt to FCF ratio of NFLX (2.02) is better than 74.65% of its industry peers.
A Debt/Equity ratio of 0.58 indicates that NFLX is somewhat dependend on debt financing.
With a Debt to Equity ratio value of 0.58, NFLX perfoms like the industry average, outperforming 49.30% of the companies in the same industry.
Even though the debt/equity ratio score it not favorable for NFLX, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.
Industry RankSector Rank
Debt/Equity 0.58
Debt/FCF 2.02
Altman-Z 13.29
ROIC/WACC2.56
WACC8.95%
NFLX Yearly LT Debt VS Equity VS FCFNFLX Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 5B 10B 15B 20B

2.3 Liquidity

A Current Ratio of 1.20 indicates that NFLX should not have too much problems paying its short term obligations.
The Current ratio of NFLX (1.20) is better than 64.79% of its industry peers.
A Quick Ratio of 1.20 indicates that NFLX should not have too much problems paying its short term obligations.
NFLX has a better Quick ratio (1.20) than 64.79% of its industry peers.
Industry RankSector Rank
Current Ratio 1.2
Quick Ratio 1.2
NFLX Yearly Current Assets VS Current LiabilitesNFLX Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2B 4B 6B 8B 10B

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7

3. Growth

3.1 Past

The Earnings Per Share has grown by an impressive 46.84% over the past year.
NFLX shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 36.86% yearly.
NFLX shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 15.00%.
The Revenue has been growing by 14.11% on average over the past years. This is quite good.
EPS 1Y (TTM)46.84%
EPS 3Y20.83%
EPS 5Y36.86%
EPS Q2Q%25.19%
Revenue 1Y (TTM)15%
Revenue growth 3Y9.51%
Revenue growth 5Y14.11%
Sales Q2Q%12.51%

3.2 Future

Based on estimates for the next years, NFLX will show a quite strong growth in Earnings Per Share. The EPS will grow by 19.27% on average per year.
NFLX is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 11.16% yearly.
EPS Next Y31.11%
EPS Next 2Y26.05%
EPS Next 3Y24.33%
EPS Next 5Y19.27%
Revenue Next Year14.35%
Revenue Next 2Y13.23%
Revenue Next 3Y12.46%
Revenue Next 5Y11.16%

3.3 Evolution

Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
The estimated forward Revenue growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
NFLX Yearly Revenue VS EstimatesNFLX Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2014 2016 2018 2020 2022 2024 2026 2028 2030 2032 20B 40B 60B 80B
NFLX Yearly EPS VS EstimatesNFLX Yearly EPS VS EstimatesYearly EPS VS Estimates 2014 2016 2018 2020 2022 2024 2026 2028 2030 2032 20 40 60

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4

4. Valuation

4.1 Price/Earnings Ratio

A Price/Earnings ratio of 56.45 indicates a quite expensive valuation of NFLX.
Compared to the rest of the industry, the Price/Earnings ratio of NFLX indicates a somewhat cheap valuation: NFLX is cheaper than 73.24% of the companies listed in the same industry.
The average S&P500 Price/Earnings ratio is at 26.60. NFLX is valued rather expensively when compared to this.
A Price/Forward Earnings ratio of 37.91 indicates a quite expensive valuation of NFLX.
Based on the Price/Forward Earnings ratio, NFLX is valued a bit cheaper than the industry average as 66.20% of the companies are valued more expensively.
Compared to an average S&P500 Price/Forward Earnings ratio of 22.43, NFLX is valued quite expensively.
Industry RankSector Rank
PE 56.45
Fwd PE 37.91
NFLX Price Earnings VS Forward Price EarningsNFLX Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 20 40 60

4.2 Price Multiples

Based on the Enterprise Value to EBITDA ratio, NFLX is valued a bit cheaper than 63.38% of the companies in the same industry.
NFLX's Price/Free Cash Flow ratio is in line with the industry average.
Industry RankSector Rank
P/FCF 68.27
EV/EBITDA 19.06
NFLX Per share dataNFLX EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 0 20 40 60 80

4.3 Compensation for Growth

The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
NFLX has an outstanding profitability rating, which may justify a higher PE ratio.
NFLX's earnings are expected to grow with 24.33% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.81
PEG (5Y)1.53
EPS Next 2Y26.05%
EPS Next 3Y24.33%

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0

5. Dividend

5.1 Amount

No dividends for NFLX!.
Industry RankSector Rank
Dividend Yield N/A

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NETFLIX INC

NASDAQ:NFLX (5/21/2025, 3:43:04 PM)

1194.44

+2.42 (+0.2%)

Chartmill FA Rating
GICS SectorCommunication Services
GICS IndustryGroupMedia & Entertainment
GICS IndustryEntertainment
Earnings (Last)04-17 2025-04-17/amc
Earnings (Next)07-16 2025-07-16/amc
Inst Owners86.17%
Inst Owner Change2.06%
Ins Owners0.03%
Ins Owner Change3.12%
Market Cap508.32B
Analysts81.05
Price Target1144.76 (-4.16%)
Short Float %1.93%
Short Ratio1.51
Dividend
Industry RankSector Rank
Dividend Yield N/A
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)6.61%
Min EPS beat(2)-0.27%
Max EPS beat(2)13.49%
EPS beat(4)3
Avg EPS beat(4)4.4%
Min EPS beat(4)-0.27%
Max EPS beat(4)13.49%
EPS beat(8)6
Avg EPS beat(8)5.37%
EPS beat(12)8
Avg EPS beat(12)1.45%
EPS beat(16)11
Avg EPS beat(16)6.88%
Revenue beat(2)0
Avg Revenue beat(2)-1.18%
Min Revenue beat(2)-1.7%
Max Revenue beat(2)-0.66%
Revenue beat(4)0
Avg Revenue beat(4)-1.35%
Min Revenue beat(4)-1.7%
Max Revenue beat(4)-0.66%
Revenue beat(8)0
Avg Revenue beat(8)-1.52%
Revenue beat(12)0
Avg Revenue beat(12)-1.65%
Revenue beat(16)0
Avg Revenue beat(16)-1.76%
PT rev (1m)3.82%
PT rev (3m)5.45%
EPS NQ rev (1m)9.16%
EPS NQ rev (3m)11.92%
EPS NY rev (1m)2.44%
EPS NY rev (3m)2.94%
Revenue NQ rev (1m)0.93%
Revenue NQ rev (3m)1.29%
Revenue NY rev (1m)0.33%
Revenue NY rev (3m)0.4%
Valuation
Industry RankSector Rank
PE 56.45
Fwd PE 37.91
P/S 12.65
P/FCF 68.27
P/OCF 64.04
P/B 21.16
P/tB N/A
EV/EBITDA 19.06
EPS(TTM)21.16
EY1.77%
EPS(NY)31.51
Fwd EY2.64%
FCF(TTM)17.5
FCFY1.46%
OCF(TTM)18.65
OCFY1.56%
SpS94.4
BVpS56.46
TBVpS-18.83
PEG (NY)1.81
PEG (5Y)1.53
Profitability
Industry RankSector Rank
ROA 17.8%
ROE 38.58%
ROCE 26.27%
ROIC 22.93%
ROICexc 28.58%
ROICexgc 496.42%
OM 27.71%
PM (TTM) 23.07%
GM 46.92%
FCFM 18.53%
ROA(3y)12.2%
ROA(5y)11.02%
ROE(3y)27.7%
ROE(5y)28.07%
ROIC(3y)16.17%
ROIC(5y)15.85%
ROICexc(3y)20.02%
ROICexc(5y)19.87%
ROICexgc(3y)637.19%
ROICexgc(5y)N/A
ROCE(3y)18.53%
ROCE(5y)18.16%
ROICexcg growth 3YN/A
ROICexcg growth 5YN/A
ROICexc growth 3Y14.95%
ROICexc growth 5Y21.57%
OM growth 3Y8.59%
OM growth 5Y15.63%
PM growth 3Y9.04%
PM growth 5Y19.25%
GM growth 3Y3.42%
GM growth 5Y3.77%
F-Score8
Asset Turnover0.77
Health
Industry RankSector Rank
Debt/Equity 0.58
Debt/FCF 2.02
Debt/EBITDA 0.52
Cap/Depr 3.12%
Cap/Sales 1.22%
Interest Coverage 250
Cash Conversion 29.5%
Profit Quality 80.32%
Current Ratio 1.2
Quick Ratio 1.2
Altman-Z 13.29
F-Score8
WACC8.95%
ROIC/WACC2.56
Cap/Depr(3y)2.68%
Cap/Depr(5y)3.36%
Cap/Sales(3y)1.15%
Cap/Sales(5y)1.44%
Profit Quality(3y)81.18%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)46.84%
EPS 3Y20.83%
EPS 5Y36.86%
EPS Q2Q%25.19%
EPS Next Y31.11%
EPS Next 2Y26.05%
EPS Next 3Y24.33%
EPS Next 5Y19.27%
Revenue 1Y (TTM)15%
Revenue growth 3Y9.51%
Revenue growth 5Y14.11%
Sales Q2Q%12.51%
Revenue Next Year14.35%
Revenue Next 2Y13.23%
Revenue Next 3Y12.46%
Revenue Next 5Y11.16%
EBIT growth 1Y41.41%
EBIT growth 3Y18.92%
EBIT growth 5Y31.95%
EBIT Next Year30.43%
EBIT Next 3Y21.76%
EBIT Next 5Y18.17%
FCF growth 1Y153.82%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y141.85%
OCF growth 3Y165.66%
OCF growth 5YN/A