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Netflix (NFLX) Stock Analysis

Here is a fundamental analysis of Netflix (NFLX), benchmarking its profitability, financial strength, dividend and valuation against its industry group peers.

Performance

Cumulative Growth

NFLX
GSPC
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Netflix (NFLX) vs. S&P 500 (GSPC): Growth of a $10,000 investment over the past five years. Adjusted for dividends and splits.

Trailing Returns

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Trailing total returns for Netflix (NFLX) and S&P 500 (GSPC). Returns over one year are annualized.

Performance at a Glance

Netflix (NFLX) metric values compared with Media & Entertainment industry-group medians
MetricCurrent stock: NFLXIndustry group median
1-Year Return-33.88%-4.70%

Risk

Drawdown

NFLX
GSPC
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Netflix (NFLX) vs. S&P 500 (GSPC): Drawdown from the running peak over the past five years. Each line shows the decline from its prior peak; 0% marks a new high.

Risk at a Glance

Netflix (NFLX) metric values compared with Media & Entertainment industry-group medians
MetricCurrent stock: NFLXIndustry group median
1-Year Volatility33.12%46.11%
Beta1.500.96

Company Profile

Company profile fields for Netflix (NFLX)
Profile ItemNFLX
NameNetflix, Inc.
Country/RegionUnited States
GICS SectorCommunication Services
GICS Industry GroupMedia & Entertainment
GICS IndustryEntertainment
GICS Sub-IndustryMovies & Entertainment
Market Capitalization338.30 billion USD
CurrencyUSD
ExchangeNasdaq
Listing DateMay 23, 2002
Security TypeCommon Stock

Valuation

Price-to-Earnings Ratio (TTM)

Netflix (NFLX) trades at P/E ratio of 25.92, near the industry’s usual earnings multiple. The stock is not showing a clear peer discount or premium on trailing earnings.

NFLX

Media & Entertainment industry group

25.92

Group distribution
Max
71.35
Q3
37.05
NFLX
25.92
Median
21.91
Q1
11.66
Min
1.74
Largest peers
SPOT
32.46
GOOGL
27.48
GOOG
27.32
NFLX
25.92
META
20.62
DIS
16.01
CMCSA
4.80
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Where Netflix (NFLX) stands on P/E ratio within its Media & Entertainment peer group — the box is the group’s distribution and the dots its largest members.

Price-to-Sales Ratio (TTM)

Netflix (NFLX) trades at 7.21 on P/S ratio, in the higher sales-valuation quartile. Investors are paying up for each dollar of revenue, so stronger margins, growth, or revenue quality need to carry that price.

NFLX

Media & Entertainment industry group

7.21

Group distribution
Max
8.58
NFLX
7.21
Q3
3.91
Median
1.48
Q1
0.55
Min
0.00
Largest peers
GOOGL
10.38
GOOG
10.34
NFLX
7.21
META
6.70
SPOT
5.65
DIS
1.79
CMCSA
0.70
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Where Netflix (NFLX) stands on P/S ratio within its Media & Entertainment peer group — the box is the group’s distribution and the dots its largest members.

Price-to-Book Ratio (MRQ)

Netflix (NFLX) trades at 10.87 on P/B ratio, in the higher book-value quartile. The market is paying a premium to book, so stronger ROE, cleaner assets, or a better growth profile need to justify it.

NFLX

Media & Entertainment industry group

10.87

Group distribution
Max
11.21
NFLX
10.87
Q3
5.56
Median
1.93
Q1
0.82
Min
-2.89
Largest peers
NFLX
10.87
SPOT
10.10
GOOGL
9.10
GOOG
9.06
META
5.91
DIS
1.61
CMCSA
0.99
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Where Netflix (NFLX) stands on P/B ratio within its Media & Entertainment peer group — the box is the group’s distribution and the dots its largest members.

Valuation at a Glance

Netflix (NFLX) metric values compared with Media & Entertainment industry-group medians
MetricCurrent stock: NFLXIndustry group median
Price-to-Earnings Ratio (TTM)25.9221.91
Price-to-Sales Ratio (TTM)7.211.48
Price-to-Book Ratio (MRQ)10.871.93
Free Cash Flow Yield7.68%7.41%

Profitability

Return on Equity (TTM)

Netflix (NFLX) posts ROE of 48.50%, above the industry benchmark range. Equity is being turned into profit at an exceptional rate, but very high ROE should still be checked against leverage, buybacks, and the size of the equity base.

NFLX

Media & Entertainment industry group

48.50%

Group distribution
NFLX
48.50%
Max
46.65%
Q3
16.35%
Median
6.52%
Q1
-4.21%
Min
-29.59%
Largest peers
NFLX
48.50%
GOOGL
38.89%
GOOG
38.89%
SPOT
37.99%
META
32.93%
CMCSA
20.92%
DIS
11.01%
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Where Netflix (NFLX) stands on ROE within its Media & Entertainment peer group — the box is the group’s distribution and the dots its largest members.

Net Profit Margin (TTM)

Netflix (NFLX) keeps 28.52% of revenue as net profit, putting net margin in the upper peer quartile. After operating costs, interest, and taxes, more of each sales dollar reaches shareholders than it does at most industry peers.

NFLX

Media & Entertainment industry group

28.52%

Group distribution
Max
30.77%
NFLX
28.52%
Q3
10.51%
Median
3.81%
Q1
-3.12%
Min
-20.69%
Largest peers
GOOGL
37.92%
GOOG
37.92%
META
32.84%
NFLX
28.52%
SPOT
15.45%
CMCSA
15.00%
DIS
11.54%
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Where Netflix (NFLX) stands on net margin within its Media & Entertainment peer group — the box is the group’s distribution and the dots its largest members.

Operating Profit Margin (TTM)

Netflix (NFLX) turns 32.30% of revenue into operating profit, putting operating margin in the upper peer quartile. Before financing and taxes enter the picture, the day-to-day business keeps more of each sales dollar than most industry peers.

NFLX

Media & Entertainment industry group

32.30%

Group distribution
Max
41.37%
NFLX
32.30%
Q3
16.41%
Median
8.47%
Q1
-3.09%
Min
-26.23%
Largest peers
META
40.62%
GOOGL
36.12%
GOOG
36.12%
NFLX
32.30%
SPOT
15.77%
DIS
15.51%
CMCSA
13.15%
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Where Netflix (NFLX) stands on operating margin within its Media & Entertainment peer group — the box is the group’s distribution and the dots its largest members.

Profitability at a Glance

Netflix (NFLX) metric values compared with Media & Entertainment industry-group medians
MetricCurrent stock: NFLXIndustry group median
Return on Equity (TTM)48.50%6.52%
Return on Assets (TTM)15.40%3.34%
Net Profit Margin (TTM)28.52%3.81%
Operating Profit Margin (TTM)32.30%8.47%
Gross Profit Margin (TTM)49.03%52.29%

Financial Strength

Current Ratio (MRQ)

Netflix (NFLX) has current ratio of 1.41, in the healthier middle range for its industry. The short-term asset cushion looks balanced relative to peers rather than stretched thin.

NFLX

Media & Entertainment industry group

1.41

Group distribution
Max
4.23
Q3
2.26
NFLX
1.41
Median
1.36
Q1
0.89
Min
0.31
Largest peers
META
2.35
SPOT
2.06
GOOGL
1.92
GOOG
1.92
NFLX
1.41
CMCSA
0.87
DIS
0.68
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Where Netflix (NFLX) stands on current ratio within its Media & Entertainment peer group — the box is the group’s distribution and the dots its largest members.

Debt-to-Equity Ratio (MRQ)

Netflix (NFLX) has debt-to-equity ratio of 0.54, roughly in line with the peer group’s normal leverage range. Its mix of debt and equity looks typical for the industry.

NFLX

Media & Entertainment industry group

0.54

Group distribution
Max
2.46
Q3
1.30
NFLX
0.54
Median
0.54
Q1
0.17
Min
0.00
Largest peers
CMCSA
1.07
NFLX
0.54
DIS
0.41
META
0.36
GOOGL
0.20
GOOG
0.20
SPOT
0.06
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Where Netflix (NFLX) stands on debt-to-equity ratio within its Media & Entertainment peer group — the box is the group’s distribution and the dots its largest members.

Financial Strength at a Glance

Netflix (NFLX) metric values compared with Media & Entertainment industry-group medians
MetricCurrent stock: NFLXIndustry group median
Current Ratio (MRQ)1.411.36
Debt-to-Equity Ratio (MRQ)0.540.54
Net Debt / EBITDA0.311.34

Dividends

Dividend Yield (TTM)

Netflix (NFLX) pays no dividend, leaving dividend yield at 0.00% this period. Shareholders may still receive value through reinvestment or buybacks, but there is no dividend income to compare here.

NFLX

Media & Entertainment industry group

0.00%

Group distribution
Max
2.67%
Q3
1.17%
NFLX
0.00%
Median
0.00%
Q1
0.00%
Min
0.00%
Largest peers
CMCSA
5.39%
DIS
1.50%
META
0.37%
GOOG
0.25%
GOOGL
0.24%
NFLX
0.00%
SPOT
0.00%
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Where Netflix (NFLX) stands on dividend yield within its Media & Entertainment peer group — the box is the group’s distribution and the dots its largest members.

Dividend Payout Ratio (TTM)

Netflix (NFLX) paid no earnings out as dividends this period, leaving payout ratio at 0.00%. There is no dividend payout to size against earnings.

NFLX

Media & Entertainment industry group

0.00%

Group distribution
Max
57.34%
Q3
24.40%
NFLX
0.00%
Median
0.00%
Q1
0.00%
Min
0.00%
Largest peers
CMCSA
25.88%
DIS
20.00%
META
7.64%
GOOGL
6.41%
GOOG
6.41%
NFLX
0.00%
SPOT
0.00%
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Where Netflix (NFLX) stands on payout ratio within its Media & Entertainment peer group — the box is the group’s distribution and the dots its largest members.

Dividends at a Glance

Netflix (NFLX) metric values compared with Media & Entertainment industry-group medians
MetricCurrent stock: NFLXIndustry group median
Dividend Yield (TTM)0.00%0.00%
Dividend Payout Ratio (TTM)0.00%0.00%