NFLX - Netflix: Time To Move On From Membership Metrics

2024-04-24 00:10:31 ET

Summary

• Netflix's Q1 earnings beat analyst estimates, with strong revenue growth and membership additions.
• The decision to stop reporting quarterly membership guidance caused a negative market reaction, but the rationale behind it makes sense.
• The deal with WWE presents a significant growth opportunity for Netflix, particularly in expanding its advertising business and acquiring more subscribers.

Investment Thesis

In my last article on Netflix ( NFLX ), published in October 2023, I argued why the company's strategy of price increases and an increased push towards animated movies showcased its ability to grow even during a challenging environment. I upgraded my rating from a HOLD to a BUY at the time. Since my article was published, the stock has gained nearly 37%, comfortably beating the S&P 500, which rose 19.5%....

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