Netflix Stock Analysis, Valuation (NASDAQ:NFLX)

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$331.82 $7.64 (2.36%) NFLX stock closing price May 21, 2018 (Closing)
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Netflix
Updated on : May 21, 2018
previous close
NFLX 331.8 (0%)
S&P 500 2733 (0%)
Closing Price On: May 21, 2018
stock rating
RATING: ★★★★★★★★★★ (0/5)
Industry :
Broadcasting-Radio-TV
Sector :
Consumer Discretionary
5 Quarter Revenue
Revenue Growth
2018-Q1
$billion
%
YOY GROWTH
Compared to the industry
Long Term Growth
5 Year CAGR:
27.7%
Operating Profit
Operating Margin:
8.1%
Sector Average:
10.4%
5 Quarter Net Profit
Net Margins
2018-Q1
%
LTM Margin
Compared to the industry
Debt/Equity Ratio
Debt:
6.54B
Debt/Equity Ratio:
 1.63
Compared to the industry
Cash Flow
Operating cash flow:
-$236.8M
Net Income:
$290.1M
PROS      CONS
Recent Growth
Long Term Growth
ROE
High Debt Burden
Cash Flow
FCF Margin
PE Valuation
PS Valuation
Rating: ★★★★★★★★★★ (0/5)
Relative Valuation
NFLX PS :
11.3
Industry PS :
1.6
Sector:   Consumer Discretionary.   *PE adjusted for one time items.
Other Metrics
Return on Invested Capital:
6.8%
Return on Equity:
19.7%
Free Cash Flow Margin:
-7.4%
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Netflix Stock Analysis

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Watch the robo advisor video of Netflix stock analysis on Amigobulls. This video puts forward our latest analysis highlighting the pros and cons for NFLX stock.

Note: Amigobulls stock rating is our opinion based on the historical performance of the company's fundamentals. It is not indicative of the future performance of the stock.

Netflix, Inc. Stock Rating 2.3/5

Amigobulls NFLX stock analysis takes into account various financial ratios like relative valuation, Netflix revenue, growth and return on equity based on latest quarter 2018 Q1 financial statements. We also check Netflix dividend performance. Netflix valuation forms a crucial part of our stock analysis. Netflix stock rating encapsulates our opinion about the company based on the fundamentals.

Should you buy NFLX stock?

  • Netflix sales grew by 40.4% year on year in 2018 Q1.
  • Long term revenue growth has been strong with a 5 year compounded annual growth of 27.7%.
  • Return On Equity (ROE) which is a measure of the company's profitability, looks great for Netflix at 19.7%.

Should you sell NFLX stock?

  • With a debt/equity ratio of  1.63, Netflix is highly leveraged in comparison to Consumer Discretionary peers.
  • Trading at a PE ratio of 222.7, NFLX stock is overvalued in comparison to industry average multiple of 21.3.
  • The company is trading at a price to sales multiple of 11.3, which is overvalued in comparison to the Broadcasting-Radio-TV industry average multiple of 1.6.
  • Netflix has a negative FCF (Free Cash Flow) margin of -7.4%.

Comments on this video and Netflix stock

Amigobulls Netflix stock analysis helps investors in understanding how the company's fundamentals have performed in the last few quarters. Fundamentals of a company give detailed information which helps in making invesment decisions.

Netflix revenue growth is an indicator of the demand for a company's products while profit margin is indicative of company's pricing power and pricing strategy. Technical analysis comes in handy to check whether the market sentiment is in line with the fundamental picture of the company.