Netflix Stock ( NASDAQ:NFLX )
Netflix ( NASDAQ:NFLX ) is on the right track once more. The company added 7.66 million members in 4Q2022 , indicating that the subscriber drop in 1H2022 is now over. Despite increased competition in the streaming industry, Netflix remains the obvious leader. The company continues to demonstrate its ability to extend its content portfolio with appealing products, which should help it maintain its value proposition. Furthermore, the recent initiatives taken by management (the introduction of an ad-based tier and the implementation of a program to combat password sharing) should be revenue accretive in the coming years. However, the share price has risen dramatically, gaining by 22.3% year to date.
The company now trades at a 2-year projected P/E of 23x, indicating that the value mostly reflects low-teen sales growth and a 300 basis point increase in net profit margin. Unless and until I see more reasons for revenue growth in the high teens (or more), my current rating for Netflix stock is a Hold.
A Return to Subscriber Growth
Netflix has effectively returned to positive subscriber growth in the second half of 2022. The company saw a significant rise in subscribers during the early stages of the pandemic but was unable to capitalize on that momentum. The subscriber base declined in the first half of 2022, causing investors to fear that the company’s boom days are over owing to the increased competition in the streaming market.
What I admire about Netflix’s 4Q2022 figures is that subscription growth has returned in all markets. The company’s most mature market, the United ...
Click here to read the full article on PressReach.com .Subscribe to the PressReach RSS feeds:
- Featured News RSS feed
- Investing News RSS feed
- Daily Press Releases RSS feed
- Trading Tips RSS feed
- Investing Videos RSS feed
Follow PressReach on Twitter
Follow PressReach on TikTok
Follow PressReach on Instagram
Subscribe to us on Youtube