NasdaqGS:NFLX

Stock Analysis Report

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Executive Summary

Netflix, Inc. provides subscription streaming entertainment service. More Details


Snowflake Analysis

High growth potential with solid track record.


Similar Companies

Share Price & News

How has Netflix's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: NFLX has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-8.0%

NFLX

-1.9%

US Entertainment

-1.1%

US Market


1 Year Return

73.2%

NFLX

38.6%

US Entertainment

15.6%

US Market

Return vs Industry: NFLX exceeded the US Entertainment industry which returned 41.1% over the past year.

Return vs Market: NFLX exceeded the US Market which returned 17.8% over the past year.


Shareholder returns

NFLXIndustryMarket
7 Day-8.0%-1.9%-1.1%
30 Day1.1%1.5%4.2%
90 Day-0.06%5.4%6.3%
1 Year73.2%73.2%39.2%38.6%18.2%15.6%
3 Year146.1%146.1%71.9%68.4%39.6%30.4%
5 Year353.6%353.6%92.6%83.8%79.5%59.2%

Price Volatility Vs. Market

How volatile is Netflix's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Netflix undervalued compared to its fair value and its price relative to the market?

76.55x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: NFLX ($488.24) is trading above our estimate of fair value ($308.07)

Significantly Below Fair Value: NFLX is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: NFLX is poor value based on its PE Ratio (76.6x) compared to the US Entertainment industry average (30.7x).

PE vs Market: NFLX is poor value based on its PE Ratio (76.6x) compared to the US market (19.1x).


Price to Earnings Growth Ratio

PEG Ratio: NFLX is poor value based on its PEG Ratio (2.7x)


Price to Book Ratio

PB vs Industry: NFLX is overvalued based on its PB Ratio (20.9x) compared to the US Entertainment industry average (3.4x).


Next Steps

Future Growth

How is Netflix forecast to perform in the next 1 to 3 years based on estimates from 39 analysts?

28.2%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: NFLX's forecast earnings growth (28.2% per year) is above the savings rate (2.2%).

Earnings vs Market: NFLX's earnings (28.2% per year) are forecast to grow faster than the US market (22.1% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: NFLX's revenue (14.2% per year) is forecast to grow faster than the US market (9.9% per year).

High Growth Revenue: NFLX's revenue (14.2% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: NFLX's Return on Equity is forecast to be high in 3 years time (26.5%)


Next Steps

Past Performance

How has Netflix performed over the past 5 years?

53.6%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: NFLX has high quality earnings.

Growing Profit Margin: NFLX's current net profit margins (11.8%) are higher than last year (7.5%).


Past Earnings Growth Analysis

Earnings Trend: NFLX's earnings have grown significantly by 53.6% per year over the past 5 years.

Accelerating Growth: NFLX's earnings growth over the past year (97.8%) exceeds its 5-year average (53.6% per year).

Earnings vs Industry: NFLX earnings growth over the past year (97.8%) exceeded the Entertainment industry 44.6%.


Return on Equity

High ROE: Whilst NFLX's Return on Equity (27.16%) is high, this metric is skewed due to their high level of debt.


Next Steps

Financial Health

How is Netflix's financial position?


Financial Position Analysis

Short Term Liabilities: NFLX's short term assets ($9.8B) exceed its short term liabilities ($7.9B).

Long Term Liabilities: NFLX's short term assets ($9.8B) do not cover its long term liabilities ($20.3B).


Debt to Equity History and Analysis

Debt Level: NFLX's debt to equity ratio (155.3%) is considered high.

Reducing Debt: NFLX's debt to equity ratio has increased from 110.6% to 155.3% over the past 5 years.

Debt Coverage: NFLX's debt is not well covered by operating cash flow (6.9%).

Interest Coverage: NFLX's interest payments on its debt are well covered by EBIT (5.9x coverage).


Balance Sheet


Next Steps

Dividend

What is Netflix current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

Notable Dividend: Unable to evaluate NFLX's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate NFLX's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if NFLX's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if NFLX's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of NFLX's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

  • Explore strong dividend paying companies in the Media industry.

Management

How experienced are the management team and are they aligned to shareholders interests?

1.8yrs

Average management tenure


CEO

Wilmot Hastings (60 yo)

0.25

Tenure

US$38,577,129

Compensation

Mr. Wilmot Reed Hastings, Jr., is President of Netflix, Inc. and has been its Chairman from 1997. Mr. Hastings co-founded Netflix in 1997. In 1991, Mr. Hastings founded Pure Software. He served as Chief Ex ...


CEO Compensation Analysis

Compensation vs Market: Wilmot's total compensation ($USD38.58M) is above average for companies of similar size in the US market ($USD11.16M).

Compensation vs Earnings: Wilmot's compensation has been consistent with company performance over the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Wilmot Hastings
Co-Founder0.25yrUS$38.58m1.15%
$ 2.5b
Theodore Sarandos
Co-CEO, Chief Content Officer & Director0.25yrUS$34.67m0%
$ 0
Spencer Neumann
Chief Financial Officer1.75yrsUS$11.98m0%
$ 0
Gregory Peters
COO & Chief Product Officer0.25yrUS$18.63m0.0030%
$ 6.4m
David Hyman
Chief Legal Officer & Secretary18.75yrsUS$8.16m0.0072%
$ 15.4m
Spencer Wang
Vice President of Finance5.75yrsno datano data
Rachel Whetstone
Chief Communications Officer2.17yrsno datano data
Bozoma John
Chief Marketing Officer0.33yrno datano data
William Holmes
Global Head of Business Developmentno datano datano data
Jessica Neal
Chief Talent Officer3yrsno datano data
Christie Fleischer
Global Head of Consumer Products2.08yrsno datano data
Monika Shergill
Head of Series & International Originals - Netflix India1.42yrsno datano data

1.8yrs

Average Tenure

51yo

Average Age

Experienced Management: NFLX's management team is not considered experienced ( 1.8 years average tenure), which suggests a new team.


Board Members

NamePositionTenureCompensationOwnership
Wilmot Hastings
Co-Founder0.25yrUS$38.58m1.15%
$ 2.5b
Theodore Sarandos
Co-CEO, Chief Content Officer & Director0.25yrUS$34.67m0%
$ 0
Jay Hoag
Lead Independent Directorno dataUS$366.56k0.14%
$ 293.4m
Timothy Haley
Independent Director22.33yrsUS$366.56k0%
$ 0
Richard Barton
Independent Director18.42yrsUS$366.56k0.0016%
$ 3.5m
Ann Mather
Independent Director10.08yrsUS$366.56k0%
$ 0
Leslie Kilgore
Independent Director8.75yrsUS$366.56k0.0080%
$ 17.2m
Mathias Döpfner
Independent Director2.08yrsUS$366.57k0.000010%
$ 21.6k
Bradford Smith
Independent Director5.58yrsUS$366.57k0.0015%
$ 3.2m
Susan Rice
Independent Director2.58yrsUS$366.67k0%
$ 0
Anne Sweeney
Independent Director5.58yrsUS$366.57k0%
$ 0
Rodolphe Belmer
Independent Director2.75yrsUS$366.53k0%
$ 0

5.6yrs

Average Tenure

58.5yo

Average Age

Experienced Board: NFLX's board of directors are considered experienced (5.6 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Netflix, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Netflix, Inc.
  • Ticker: NFLX
  • Exchange: NasdaqGS
  • Founded: 1997
  • Industry: Movies and Entertainment
  • Sector: Media
  • Market Cap: US$215.702b
  • Shares outstanding: 441.80m
  • Website: https://www.netflix.com

Number of Employees


Location

  • Netflix, Inc.
  • 100 Winchester Circle
  • Los Gatos
  • California
  • 95032
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
NFLXNasdaqGS (Nasdaq Global Select)YesCommon StockUSUSDMay 2002
NFCXTRA (XETRA Trading Platform)YesCommon StockDEEURMay 2002
NFCDB (Deutsche Boerse AG)YesCommon StockDEEURMay 2002
NFLX *BMV (Bolsa Mexicana de Valores)YesCommon StockMXMXNMay 2002
NFLXSWX (SIX Swiss Exchange)YesCommon StockCHCHFMay 2002
0QYILSE (London Stock Exchange)YesCommon StockGBUSDMay 2002
NFLXBIT (Borsa Italiana)YesCommon StockITEURMay 2002
NFLXWBAG (Wiener Boerse AG)YesCommon StockATEURMay 2002
NFLXBVL (Bolsa de Valores de Lima)YesCommon StockPEUSDMay 2002
NFLX34BOVESPA (Bolsa de Valores de Sao Paulo)BDR EACH REPR 1 COM SHSBRBRLAug 2012
NFLXBASE (Buenos Aires Stock Exchange)CEDEAR EACH 16 REP 1 COM USD0.001 (USD)ARARSApr 2019

Biography

Netflix, Inc. provides subscription streaming entertainment service. It offers TV series, documentaries, and feature films across various genres and languages. The company provides members the ability to r ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/10/26 23:56
End of Day Share Price2020/10/26 00:00
Earnings2020/09/30
Annual Earnings2019/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.