#1 - Netflix (NASDAQ:NFLX)
For a stock that doesn’t pay a dividend, Netflix Inc. (NASDAQ: NFLX) has certainly rewarded investors with a strong total return of around 172% in the last five years. Many investors know that came with a sharp downturn at the beginning of 2022, but the last two and a half years have been smooth sailing for the streaming giant.
The turnaround is based largely on the company’s adoption of an ad-supported tier and, more importantly, the revenue that comes with it. To the company’s delight, subscribers aren’t balking at having their streaming interrupted. In fact, a recent survey by Deloitte noted that almost 40% of consumers under 41 would like to interact with the advertisements.
And with the company’s foray into live sports, even premium subscribers will have to watch ads. Plus, the company says that as part of its programming strategy, even premium subscribers may have their content interrupted by a few commercials in the coming years.
The Netflix analyst forecasts on MarketBeat give the stock a Moderate Buy rating with a $748.55 price target. This suggests that many investors believe NFLX stock, which trades at 40x forward earnings, is too expensive. But the company’s ad-supported tier now has over 40 million subscribers—that’s larger than the total subscriber base of both Peacock and Apple TV+. It's the clear winner in streaming and is justifying its premium price.
About Netflix
Netflix, Inc provides entertainment services. It offers TV series, documentaries, feature films, and games across various genres and languages. The company also provides members the ability to receive streaming content through a host of internet-connected devices, including TVs, digital video players, TV set-top boxes, and mobile devices.
Read More - Current Price
- $836.72
- Consensus Rating
- Moderate Buy
- Ratings Breakdown
- 24 Buy Ratings, 9 Hold Ratings, 2 Sell Ratings.
- Consensus Price Target
- $748.15 (10.6% Downside)
