NFLX - Netflix: Shifting From Growth To Quality

2024-06-10 06:46:13 ET

Summary

• Netflix has emerged from a period of immense growth and industry disruption, but that appears to be slowing down.
• The company leads against competition from other streaming platforms like Disney Plus, Peacock, and HBO Max.
• Their shifting focus towards engagement rather than total subscribers reflects the evolving media landscape, where platforms like YouTube and TikTok thrive.
• Current valuation seems to be in excess of growth outlooks, which is not helped by aggressive buybacks, and so long-term returns may not be optimal.

Netflix ( NFLX ) pioneered the streaming-service industry. What was a novelty over a decade ago is now the standard for media consumption, thanks in large part to their work. After a long stretch of growth, the company turned positive cash flows a few years ago. In that time, we've seen how the market can change its mind about Netflix's financial ability.

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