Netflix Stock Analysis, Valuation (NASDAQ:NFLX)
Netflix Stock Analysis
View Netflix stock analysis video. This is our analyst opinion covering the buy and sell arguments for NFLX stock.
Netflix, Inc. Stock Rating 2.1/5
Our Netflix stock opinion is based on fundamentals of the company. This Netflix stock analysis is based on latest 2017 Q2 earnings. The stock price analysis takes into account the company's valuation metrics.
Should you buy NFLX stock?
- Netflix sales grew by 32.3% year on year in 2017 Q2.
- Long term revenue growth has been strong with a 5 year compounded annual growth of 24.1%.
- The LTM ROE of 13.2% for Netflix is attractive.
Should you sell NFLX stock?
- Netflix had a poor average operating margin of 6.3% over the last 4 quarters.
- Netflix's Net margins were poor at 3.6% in the last twelve months.
- With a debt/equity ratio of 1.55, Netflix is highly leveraged in comparison to Consumer Discretionary peers.
- The NFLX stock currently trades at a PE of 228.5, which is expensive, compared to the industry average of 21.2.
- The company is trading at a price to sales multiple of 7.9, which is overvalued in comparison to the Broadcasting-Radio-TV industry average multiple of 1.6.
- The company has negative Free Cash Flows (FCF), with a negative FCF margin of -21.5%.